From my point of view, vat is reclaimable and previous advise is to make your self employed business description as wide as possible and if possible make vatable sales immediately. OK, we know you cant sell your flying services until you pass the cpl, but you can sell ancillary products. T shirts, caps, . In my case, I own a jewellery business and my son intends to commence his PPLh with a genuine view for it to become his livelihood as soon as hours etc permit. I consider that as ne commences as a self employed pilot, he will also rent from my shop, a display cabinet and window space. He will purchase aviation themed jewellery and these will be sold through the shop, vat will be added to the price and paid to the vat man on his quarterly returns. He will also create a web site and use ebay to sell his products whilst he trains. Therefore he will reclaim substantial amounts of vat from his training costs, but also pay smaller amounts of vat for his income. He will not get cpl flying income for about a year, although it would be good to try to qualify inside the first year, to enable a couple flying invoices to be included and maybe thereafter a couple a month.
So, Air Law Question 1. Relates to what constitutes commercial work prior to passing cpl. I know the pilot cannot sell his flying services until cpl qualified, but can take passengers once ppl qualified. Is it therefore allowed for the non fee paying passenger (family, friend etc) to take photos etc whilst the pilot does the hour building.
If so, if the photos are of familiy and friends homes, can these be sold either by the pilot or by the passenger to the family member who owns the home? Each photo may be worth £20 in a nice frame, but could they be sold for say £350 and to include a free hours air experience flight, to be flown once the cpl is obtained?
It occurs to me that this could be tantamount to cpl work and therefore not allowed,but it could be argued otherwise and therefore allows family members to 'sponsor' the costs of training. I would think 20 or 30 such photos could be sold (probably to family members who would otherwise donate or sponsor,give a Christmas present, just to support the family member) but the income would cover a huge chunk of the commercial licence fee and show the VAT man that you are trading.
Also, would you charge vat on £20 or £350 ? (remember to pay the vat back to the vat man).