[twt]

Recently I was going to make a purchase from a supplier, i choose the items i wanted on their web site then went to the checkout when i got the final price they had charged VAT on postage. I know this is petty but i didn't go through with the order from them because of this, surely they should only Charge VAT on products or services supplied by them because otherwise we will be getting charged twice for VAT on postage as VAT is already included. Im not going to name names but if any suppiers are out there and you know you are guilty of this explain your selfs or please put it right.
Sorry to complainbut  im not sure if im being picky so if you agree with me say so.
rant over

[Bonzer]

Hi, if you are VAT registered you have to charge VAT on any service including the postage. It keeps Gordon happy 

[Andrew McCann]

Hiya Philip

I don't think this is really naughty as you put it. The supplier has to pay VAT on the shipping charge from whatever company they use.

I always try to give a price for equipment including VAT. Sometimes when quoting say over the phone its a bit difficult to do so as the prices we have to work from dont include VAT so you have to be very quick especially if there are a few items to price for.

I do understand where you are coming from though. Something can initially look like a good deal but when you add VAT.. shipping and then VAT on the shipping it can be a different story.

Dave.. aka St Ive's likes to call me Mr £995.00..  this does include VAT and shipping though  lol  At least this way the customer knows up-front what the cost will be.

To illustrate.  this £995 would looka lot cheaper at £822 then a checkout which ends up at £995 including VAT and shipping.

To defend others though if you are buying  items online the software normally used does at VAT at checkout.

I dont think anyone is being really naughty here.

Andrew..

Doesn't a good rant do you good sometimes?  

[Paul Coleman]

Hiya Philip

I don't think this is really naughty as you put it. The supplier has to pay VAT on the shipping charge from whatever company they use.

I always try to give a price for equipment including VAT. Sometimes when quoting say over the phone its a bit difficult to do so as the prices we have to work from dont include VAT so you have to be very quick especially if there are a few items to price for.

I do understand where you are coming from though. Something can initially look like a good deal but when you add VAT.. shipping and then VAT on the shipping it can be a different story.

Dave.. aka St Ive's likes to call me Mr £995.00..  this does include VAT and shipping though  lol  At least this way the customer knows up-front what the cost will be.

To illustrate.  this £995 would looka lot cheaper at £822 then a checkout which ends up at £995 including VAT and shipping.

To defend others though if you are buying  items online the software normally used does at VAT at checkout.

I dont think anyone is being really naughty here.

Andrew..

Doesn't a good rant do you good sometimes?  

I'm surprised at that Andrew.  I had always thought that Postage was a VAT free item.  You send a lot of stuff out so I guess if anyone knows it should be you.

[Andrew McCann]

Royal Mail postage is VAT free.

If I send out small items that can be sent via royal mail I only charge what it costs.

Carriers/couriers etc  are commercial enterprises and have to charge VAT just as we and every other VAT registered supplier does.

I hope this helps

Andrew

[spotless2000]

I may be wrong but I think 'postage' is zero rated for VAT but 'carriage' is subject to VAT at 17.5%.  Also when you see 'P + P' (post + packing) the packing is a service and is subject to VAT.

Hope someone else can explain this better than me.

Steve

Andrew just has - Cheers!

[twt]

what im saying is if a delivery company say parcel force for example charges 20 quid to deliver something that price will include VAT. so when you order goods worth 20quid you should pay VAT on 20 quid not 40quid (sorry pound symbol isn't working on my keyboard) so if a supplier charges you VAT on 40 quid i think you  are paying VAT twice on the delivery! maybe im wrong but i don't like to be taken for a ride.

[D.Salkeld_Ltd]

Phill,

At first I thought you'd got sun stroke or something!!!! 
It's something we take for granted:

Items +
Postage
= Total
VAT
= Payable

But you might have a point? Worth looking into?

David

[Paul Coleman]

Royal Mail postage is VAT free.

If I send out small items that can be sent via royal mail I only charge what it costs.

Carriers/couriers etc  are commercial enterprises and have to charge VAT just as we and every other VAT registered supplier does.

I hope this helps

Andrew

That makes sense now.  I believe that when I was told about VAT-free postage, I understood it to be wider in scope than it actually is.  Thanks for the clarification Andrew.

[Andrew McCann]

what im saying is if a delivery company say parcel force for example charges 20 quid to deliver something that price will include VAT. so when you order goods worth 20quid you should pay VAT on 20 quid not 40quid (sorry pound symbol isn't working on my keyboard) so if a supplier charges you VAT on 40 quid i think you  are paying VAT twice on the delivery! maybe im wrong but i don't like to be taken for a ride.

Ok let me try to help clear this up.

Goods = £20 + VAT  Carriage via Parcel force ( for example ) = £20.00  The supplier MUST charge VAT on the carriage as well. Say you send 20 tonnes of goods on a lorry you would expect to pay VAT..  this is exactly the same. Carriage IS NOT VAT EXEMPT. The carriage company will charge the supplier VAT on the £20.00. The supplier has no choice in the matter. To not charge VAT would be an offence.

Now.. like I have already said for small items you may be able to use postage. This IS VAT exempt so no requiremnet for VAT to be charged.

I can only speak for my company. We only ever charge what we are charged for carriage. Unfortunately we do have to charge VAT.  The VAT doesnt go to us.. it goes to the rotten inland revenue. In fact and I don't think this is uncommon we suppliers often "swallow" a percentage of the carriage charge.

I hope this helps to make it clear.

Cheers

Andrew

[Moderator David@stives]

If you use the post office then no vat is payable,

I think using a parcel company then vat is payable ?

 Most e-commerce site software has the fcility to charge vat before or after.

I was recently charged £4.00+vat postage, but when my window cleaning items arrived there was only £1.00 worth of stamps on the package.

Makes you think though.

Dave

[Moderator David@stives]

I am not so sure now

http://community.actinic.com/showthread.php?p=108492

[Moderator David@stives]

and heres what the government says

http://customs.hmrc.gov.uk/channelsPortalWebApp/channelsPortalWebApp.portal?_nfpb=true&_pageLabel=pageLibrary_ShowContent&id=HMCE_CL_000114&propertyType=document#P34_2182

[Andrew McCann]

Bl==dy Hell dave!!

It looks like VAT should be charged on postage ( stamps ) or franked as we do.

I reckon a whole lot of companies may be open to all sorts of trouble if I am reading this correctly.

We have an accountant who comes in for a day every week. She was there today in fact. She goes over every transaction we do and has never pointed this out to us. Thanks for the links mate. I will send them to work and let her try and make sense of it all. In all my years in business I have never charged VAT on straight forward postage.  maybe things have changed.

Cheers for that dave 

Andrew

[Moderator David@stives]

your most welcome Mr £995 Mccann

Dave

[Paul Coleman]

Bl==dy Hell dave!!

It looks like VAT should be charged on postage ( stamps ) or franked as we do.

I reckon a whole lot of companies may be open to all sorts of trouble if I am reading this correctly.

We have an accountant who comes in for a day every week. She was there today in fact. She goes over every transaction we do and has never pointed this out to us. Thanks for the links mate. I will send them to work and let her try and make sense of it all. In all my years in business I have never charged VAT on straight forward postage.  maybe things have changed.

Cheers for that dave 

Andrew

That looks like a grey area to me Andrew.  As you say, posting through royal mail has been VAT free but it may have changed.  Reading the website, could a workaround be possible by stating just the price of the goods but that the (royal mail) postage is provided free of charge from your comapany's profits.

[Andrew McCann]

Yes it does look a bit grey to me as well.

Lets look at posting a varisteam for example.  It doesnt weigh much so with packaging costs the postage is probably around the £2 to  3 mark.  Carriers start at around £9.. ish PLUS vat for the same thing. I think the problem would be that if you advertised it for sale including postage you would still have to charge VAT for the postage.  To be honest I think that you would only get a problem with this if you got a full audit from the VAT-man. 

Maybe this legislation is aimed more at the larger companies who send out thousands of small items through the post every day. I see it as yet another stealth tax myself and will.. if I can find a way round it. I am not being political here. I just think it's wrong to have to charge vat on postage for small items.

As I said I will get the accountant to look at this. They have never mentioned it before and are Chartered accountants so they should know the score.

Andrew

[jeff1]

How many time's is VAT charged (ie supplier and carrier) for the same item, sounds to me, the VAT man is on to a winner every time. I am talking P&P and delivery only, not on the cost of the item

[holland1945]

At last a question I feel qualified to answer, after working for a large Direct Mail organisation for some years.

If you send an item in the post through the Royal Mail to a UK address there is no VAT payable. When sending overseas, and when sending items with a courier VAT is payable.

[marc al]

  Andrew

    Regarding courier prices, have you looked at Tuffnells Parcel Express - they used to be very very cheap, when I used them we had them down to under 3 quid for every parcel sent (on a 3 day service). Granted we did send out atleast one artic load a day, but the was no weight or size limits on any package.

   Marc