Charged 17.5% VAT in Chinese restaurant!

Bamber19

JasonLVC wrote: »

I visit many restaurants and take away and receive a VAT receipt - indeed, I always ask for one as I cannot reclaim VAT through my business without a valid VAT receipt.....

You reclaim the VAT on your lunch/dinner as a business expense?

MarkyMarkD

I think you are missing the point, Jason.

If a restaurant used to charge £11.75 for a meal, which was £10+VAT @ 17.5%, then they can perfectly well choose to continue charging £11.75 now that the VAT rate is lower.

If they issue a receipt which shows £10 net and £1.75 VAT, then that is clearly wrong. But they haven't overcharged the customer, as the customer agreed to pay the £11.75 which was shown on the menu.

You are talking about a documentation error - which I am not denying. But that documentation error does not mean that the OP has been ripped off, or that they are entitled to any sort of VAT refund.

FatAndy

If businesses had to pass on the VAT cut imagine the chaos it would cause for Poundland!

JasonLVC

Bamber19 wrote: »

You reclaim the VAT on your lunch/dinner as a business expense?

Any employee who has ameal and then reclaims via expenses means the employer can reclaim the VAT - provided that meal is for the employees benefit only. You cnanot reclaim VAT on meals where you are entertainng customers/supplier, etc.

A business can also reclaim 100% VAT on Christmas parties provided only staff attend, if partners also attend then VAT can be recalimed on an apportionment basis.

JasonLVC

MarkyMarkD wrote: »

I think you are missing the point, Jason.

If a restaurant used to charge £11.75 for a meal, which was £10+VAT @ 17.5%, then they can perfectly well choose to continue charging £11.75 now that the VAT rate is lower.

If they issue a receipt which shows £10 net and £1.75 VAT, then that is clearly wrong. But they haven't overcharged the customer, as the customer agreed to pay the £11.75 which was shown on the menu.

You are talking about a documentation error - which I am not denying. But that documentation error does not mean that the OP has been ripped off, or that they are entitled to any sort of VAT refund.

MarkyMarkD - Have another look at my first post.

That was my point....I asked the OP to check whether she'd actually been charged 17.5% or not, to which the OP couldn't answer - I can only asume the receipt had shown VAT at the old rate OR the menu's were old and still had the old VAT rate on. The OP didn't clarify which.

If the restaurant has charged VAT at the old rate then it is wrong - again, which was my original point....I cannot recall ever saying that the menu price has to change - I do understand VAT and the VAT rate change and that a retailer doesn't have to reduce his prices....but he cannot charge VAT at whatever rate they like.

MarkyMarkD

But giving a receipt which SAYS "vat @ 17.5%" doesn't mean that they are actually charging VAT at 17.5%.

If they are charging you what purports to be £10+£1.75 VAT = £11.75, but they are actually declaring sales of £10.22 + £1.53 VAT = £11.75, then they are not doing anything materially wrong apart from a documentation error.

And if the customer is reclaiming the VAT, they would be a numpty to claim back an amount which is clearly wrong. Which is why most people would simply reclaim 15/115 of the gross amount.

JasonLVC

MarkyMarkD wrote: »

But giving a receipt which SAYS "vat @ 17.5%" doesn't mean that they are actually charging VAT at 17.5%.

If they are charging you what purports to be £10+£1.75 VAT = £11.75, but they are actually declaring sales of £10.22 + £1.53 VAT = £11.75, then they are not doing anything materially wrong apart from a documentation error..

Hurray!. That was what I posted in the first place. I asked the OP to check whether they had actually been charged 15% or 17.5%VAT and not be swayed by what it said on the receipt.

MarkyMarkD

No, it's not what you said. It doesn't matter "whether they had actually been charged 15% or 17.5% VAT". They have paid the right VAT-inclusive amount. End of.

DCodd

MarkyMarkD wrote: »

No, it's not what you said. It doesn't matter "whether they had actually been charged 15% or 17.5% VAT". They have paid the right VAT-inclusive amount. End of.

Bottom line is.. If they charged 17.5% and passed 17.5% to HMRC then no problem, if they charged 15% but did not reduce the the actual cost of the meal then thats ok, however if they charged 17.5% but did not account for 17.5% or did not account for the increase in net price then that is illegal but very difficult for a customer to prove, the auditors (if they are required to be auditied) will. If you are concerned, tell HMRC and they will more than likely do a VAT inspection.

Personally I would not bother, no refund is due to the op anyway, only HMRC may have lost out.

MarkyMarkD

Thanks, DCodd. I totally agree. From the OP's point of view there is nothing to get excited about and no refund due.

The chances of the restaurant passing on the wrong amount to HMRC is pretty small too. It would be obvious from the figures the restaurant provide to HMRC so I don't see that it would happen.