Good & Bad news from Mr & Mrs Backyard Bullion

[BackyardBullion]

Hello everybody!

Mrs Backyard Bullion and I have some good and bad news to share with you all.

First, the good news. Backyard Bullion (the business) has been growing well and we are excited at what the future may bring.

This leads us onto the bad news. With such success and growth comes the inevitable attention from the tax man. As such Backyard Bullion is required to register for VAT (Sales tax for those non UK/EU readers).

This will of course have some significant effects on our business but more importantly for you as our customers.   We have always been and always will be, fully committed to the strength and quality of the Backyard Bullion brand and products. The pieces we make are and will continue to be of the highest possible quality. We are a small business (Mrs BYB and myself) and have no plans or desire to hire staff. Each piece we make, be it small or large, will be unique and have been made by us with the same love, care and attention we have always put into our work.

This means that effective from 1st April 2019 we will be increasing our pricing to accommodate for part of the VAT liability we incur for our sales. 

Any items that have been pre-ordered but not paid for will have their original prices honoured even though the payment date might be after 1st April 2019. This seems the fairest thing to do for these pre-ordered items. However, for items ordered or purchased after the 1st April 2019 you will notice the price change. The most obvious product to be affected at this stage is the “1 oz & 250g Silver Forum Bars” that have not yet been reserved/paid for already.

VAT registration is something we never envisaged happening at the outset of this business but it is now a reality that cannot be ignored.

Whilst the bad news is certainly bad and only time will tell the true effect on the business we are confident about our brand and are excited about future projects we will try to bring to you.

We want to finish this announcement with a very large and heartfelt thank you to everyone out there that has supported the brand, be it through our hand poured silver, YouTube channel and group orders over this last 3 years. Your support means the world to us and we will endeavour to continue to bring you the best quality video entertainment and hand poured silver in the future!

If you have any comments or questions then please feel free to ask them here on this thread or contact me directly.

All the best to you all!

Mr & Mrs Backyard Bullion

[Bullionaire]

Congratulations on your growth! Even though it does come with a downside. .

Glad I already paid for my 1ozers!

[Nick1368]

Good luck backyardbullion and don't worry too much about the VAT, any business that their taking is over 75 grand a year (I think this is the right number ) must register for VAT which can cause a lot of  concern for small business owners, I remember when I had to go through this in 2012, I was sooo worried but it's 2019 now and my business is doing better than ever before.

All the best

[ram64]

Congratulations on the successful business and more prosperity in the future!  

[rob6]

I wish you both continued success for the future.

Yet another obstacle to overcome as any good business has to, and I am sure you attitude, ethics, and hard work will ensure your future is going to be a good one.

You both deserve it.

And don't forget, you have a lot of people supporting you and the delightful Mrs BYB.

May your dream continue to expand.  Rob

[Martlet]

Benefit is claiming back VAT on equipment, supplies, new computer so on.  

[Silversaving]

Glad to see you're doing so well with the business. I'll still do what I can to support you from over here in the states. Love your pours.

[Lr103]

Congratulations on needing to do this!  

Can you clarify how this will impact international sales, if at all?

[HighlandTiger]

The fact that you have to register for VAT, shows that as a business you are doing something right.  

[BackyardBullion]

1 hour ago, Nick1368 said:

Good luck backyardbullion and don't worry too much about the VAT, any business that their taking is over 75 grand a year (I think this is the right number ) must register for VAT which can cause a lot of  concern for small business owners, I remember when I had to go through this in 2012, I was sooo worried but it's 2019 now and my business is doing better than ever before.

All the best

Thanks Nick, we appreciate the words of encouragement, we are excited about the future for sure - it is just a big change!

The turnover threshold is £85,000 at the moment - and for those that are reading and thinking I am making £85,000 per year, that is Turnover, not profit! It it were profit I would be laughing!

1 hour ago, Bullionaire said:

Congratulations on your growth! Even though it does come with a downside. .

Glad I already paid for my 1ozers!

Thanks very much my friend!

1 hour ago, ram64 said:

Congratulations on the successful business and more prosperity in the future!  

Thanks!

52 minutes ago, rob6 said:

I wish you both continued success for the future.

Yet another obstacle to overcome as any good business has to, and I am sure you attitude, ethics, and hard work will ensure your future is going to be a good one.

You both deserve it.

And don't forget, you have a lot of people supporting you and the delightful Mrs BYB.

May your dream continue to expand.  Rob

We appreciate the kind words, thanks Rob!

44 minutes ago, Martlet said:

Benefit is claiming back VAT on equipment, supplies, new computer so on.  

Yes indeed, there are benefits to being VAT registered. We have taken these into account when deciding how to proceed with pricing. 

44 minutes ago, Silversaving said:

Glad to see you're doing so well with the business. I'll still do what I can to support you from over here in the states. Love your pours.

Thank you very much indeed!

10 minutes ago, HighlandTiger said:

The fact that you have to register for VAT, shows that as a business you are doing something right.  

We hope so, its got big this last 6 months and that is down to the customers out there supporting us!

[Noraa25]

A good accountant is worth every oz

[BackyardBullion]

27 minutes ago, Lr103 said:

Congratulations on needing to do this!  

Can you clarify how this will impact international sales, if at all?

It is a good question. 

A fair proportion of our sales are from outside the EU - primarily from the USA.

These sales will be zero rated (no additional VAT to charge), but they do need to be shipped within 3 months of payment (might affect some people 😉 more than others).

That does not mean the prices are unaffected though. We have decided a small average price increase across the board will allow us to minimise the financial impact of a 20% margin call on UK/EU sales. This will allow us to remain (hopefully) competitive in the UK/EU market and the plan would be to maintain the majority of our customer base. 

But that does mean that my US customers are footing a little bit of that bill by proxy. 

We will be carefully monitoring the situation over the coming weeks and months and if the decision to increase prices across the board impacts our sales in a very adverse way we will look to re-evaluate the situation and the practicality of moving forward for the future. 

I hope that answers your question. It is a very very complex situation with many different elements to consider that all affect our business in different ways!

I have lost many a nights sleep over it this last week in the build up to announcing this today.

[Lr103]

10 minutes ago, BackyardBullion said:

But that does mean that my US customers are footing a little bit of that bill by proxy. 

We will be carefully monitoring the situation over the coming weeks and months and if the decision to increase prices across the board impacts our sales in a very adverse way we will look to re-evaluate the situation and the practicality of moving forward for the future. 

I hope that answers your question. It is a very very complex situation with many different elements to consider that all affect our business in different ways!

I have lost many a nights sleep over it this last week in the build up to announcing this today.

It does answer my question, and that works for me!  I know having a little VAT impact will not reduce my own purchases, and hope this is the case for your orders from others as well 😊

[AppleZippoandMetronome]

Really great to hear that things are all onwards and upwards for the BYB household. Your work will shine above any increases from VAT and I have no doubt everyone will continue to support the BYB business!

[matrawr]

You'll have to excuse my lack of business knowledge but have you had to pay HMRC anything prior to the VAT?

Congratulations on the growth of your business 👍

[BackyardBullion]

8 minutes ago, matrawr said:

You'll have to excuse my lack of business knowledge but have you had to pay HMRC anything prior to the VAT?

Congratulations on the growth of your business 👍

Only my usual tax returns as a sole trader through self assessment.

Traditionally VAT is a customer problem and cost. But we are very aware of the impact a 20% additional premium would have on UK sales.

[sgcoins]

Congratulations on your growth, it's well deserved👍 

I think most costumers don't worry about the 20%tax , these are quality premium items anyway!! (saying that, i'm happy that I payed already for my April orders 😉)

[sovereignsteve]

will you be charging vat using the marginal scheme?

[BackyardBullion]

19 minutes ago, sovereignsteve said:

will you be charging vat using the marginal scheme?

Not on hand poured silver. I will be looking into the margin scheme for silver coins though and will see what we can bring to the table price wise.

[NikolaAnne]

Congratulations on achieving so much success that you now have to VAT register. This means that your business is thriving. It's a good thing. 🙂

Here's to more success!

[Seasider]

Does this VAT registration affect the group orders (assuming they continue)? Am I right to think that the group order side of things is quite separate from the production and sale side?

[BackyardBullion]

7 hours ago, Seasider said:

Does this VAT registration affect the group orders (assuming they continue)? Am I right to think that the group order side of things is quite separate from the production and sale side?

It will not affect the group orders. 

These are a disbursements and are not part of my business anyway - just someone grouping together with some mates to buy in bulk.

[Seasider]

Good news

[HelpingHands]

Would it be legal to have two companies both under the VAT threshold?

One for production and one that buys from the other one to sell?

[BackyardBullion]

Just now, HelpingHands said:

Would it be legal to have two companies both under the VAT threshold?

One for production and one that buys from the other one to sell?

Yes - esentially as a sole trader your £85,000 threshold applies to all businesses you run as a sole trader. There are some ways around it - but the two businesses have to be very separate and very different usually.