Final Mobile Bill & VAT charged

Legacy_user

I have a query as my research on various internet sites provides conflicting guidance.

Having terminated my o2 mobile contract early I have recently paid an early connection fee.

My question is simple, should I have paid VAT on this bill? It is my understanding that VAT is charged on goods/services provided, however this would not apply in the circumstances above.

Your thoughts would be appreciated.

Steve

sporedude

Yes obviousley you pay VAT.

Money_Grabber13579

I would say yes, as the service would have been supplied if you hadn't terminated early. But even my tax textbook doesn't give a clear answer in the case of cancellation penalties! I suppose its a very little used area.

Buzby

VAT applies. You may not have used the service, but since this was an agreed commitment, along with an inclusive element of calls, your decision to terminate still carries the liability. If you didn't have to pay anything extra, NO VAT would have been charged - because there was no call for payment. As there was, tax remains due.

Tigert

I can confirm the above is correct. You have to pay the VAT.