VAT in quotes

19 messages
Dark Vader    pirate
24/11/2012 at 05:23

Just a thought...

VAT applies to most goods and services and we all just pay it because we have to.

Why, therefore, do quotes separate it out..  for example..   £500 + VAT.    Why not just say its £600...?    

seren nos    pirate
24/11/2012 at 07:25

isn't that just to make it easier for the accountants to work out ways for you not to pay the VAT...........obviously only if you can afford the accountant to find all the ways to avoid the taxes

24/11/2012 at 08:47

Some people can claim the VAT back - if it's a business which is not the end user of the product, for example.

Also makes it sound less?  Like saying something is £29.99 rather than £30?

24/11/2012 at 13:07

I always thought there was a political nuance. I can do/sell you this for only £80 but the government want £16 tax so it will cost you £96 (so don't blame me!)

 

24/11/2012 at 14:08

I thought it was a legal requirement for companies to display the VAT breakdown?  We do because the government require us to.

24/11/2012 at 14:12

atleast its not like america where you go to buy something....for example $10 then they wack the tax on at the till (silly me not knowing this i know) 

Edited: 24/11/2012 at 14:12
24/11/2012 at 14:22

Jason, unfortunatly some people do just that.  I got a bill recently for £90 that turned out to be a lot more as they didn't tell me (or I didn't see) that the price was ex vat.  It helps accountants to have the vat listed seperatly but I think that it is wrong when they only quote the ex vat price.  In this particular cast I had budgeted for £90 so it messed me up to have to pay more.

Ultra AJH    pirate
24/11/2012 at 15:36
Stuff for research is ex vat, but not everything it is useful to see there.
24/11/2012 at 22:25

But if someone happens to offer you a discount for cash, you're not going to say no, are you? 

JPenno    pirate
24/11/2012 at 22:49

Its because the VAT rate is variable and can be changed at any given time by HMRC so the retailer indicates that his price is £XX plus vat, he cant control the VAT element

Dark Vader    pirate
25/11/2012 at 04:18

My point is...   when I go to pay for my car repairs the bill might be, for example, £300 and will already include the VAT.   The invoice will show the VAT but the guy doesn't say to me £XX + VAT, he'll just say £300.    If you ask for a quote from a builder, for example, he'll say £10,000 + VAT, not the total figure.

Maybe it is just to make it sounds less...?

25/11/2012 at 08:41

And VAT prices don't change that quickly because they have to give companies time to make the changes.  Never less than a month's notice.

And as most quotes are only valid for a month, I can't see why all quotes can't include the ex and inc VAT prices.

25/11/2012 at 09:51

Perhaps it is to make it sound less DV;   the vat included in a  £300 bill is only .£50 and your garage doesn't expect you to be claiming it back as a private motorist.

Your builder's vat will be a further £2,000 and might  make his estimate look uncompetitive at £12,000 if the next guy's ex-vat price is, say, £11,000.

But aren't you VAT registered anyway in your line of work?  Surely it would be to your advantage to reclaim VAT?

 

We do all pay it though, it is shocking that one-fifth of almost everything we spend is tax.

seren nos    pirate
25/11/2012 at 09:59

the most shocking things is that you pay it on sanitary products..where is the luxury item there...........what is the non luxury alternative...............but you don't pay it on certain biscuits

25/11/2012 at 20:14

generally we show the price and vat for our wholesale/business customers who can claim the vat back and so don't really care about the vat, and the final price to our retail customers who want to know how much they are paying.

25/11/2012 at 20:16

But even if you claim the VAT back, you still have to pay it in the first place.  Big companies might have enough money that it doesn't matter, but small businesses with cash flow issues could come unstuck when they have to pay the inc vat price.

It seems dishonest to me not to put both prices on

25/11/2012 at 20:27

no if we quote a price to a business we say its £100 plus VAT  (which would be £120)

if you are purchasing from a shop the price iwould be £120. there is no dishonesty, it is an attempt to make it less confusing.

It would be dishonest to quote a price  of £100, and then at the time of payment say ar yes, that is £100+VAT... businesses expect to be told what the VAT component is, or at least if I am quoting inc VAT or ex VAT (and 90% of my suppliers quote ex VAT).

The price doesn't change, we just give you the information you generally want... and if a retail customer wanted to know the ex VAT price we would give it to them.

However we then get into the how much for cash, which some people expect us to give them the ex VAT price, but  is illegal and something we dont' do

Wayne

26/11/2012 at 12:05

if a business is registered for VAT, it must charge VAT at the appropriate rate for all goods and services, unless they are specifically exempt. Whenever they supply goods or services to someone else who is also registered for VAT they must give them a VAT invoice. The buyer may be able to reclaim the VAT paid on some goods and services, but only with a VAT invoice.

30/11/2012 at 12:50

I thought (mat be incorrectly) that if you say that the price is xxx plus VAt then you have to say the what the rate of VAT is?


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