Builder vat fraud

suisidevw

Completely agree with Macman in post 38
above and if you don't follow the above advice you are an absolute mug.

jimbo88_2

I am sure he will be unhappy no matter what we say to him now....I just don't want him to think we are total doormats, that he can tell us he wants this amount and we pay him this amount, without questioning it!....

Just feel a little disappointed that for someone who seemed so genuine at first, can turn into this...I know the builder is not a "friend" but we thought we chose wisely having done abit of research and seen one of his previous jobs....Little did I know, that his last building firm went bankrupt, and is now stinging us with a surprise payment, and stealing more under the disguise of vat.......

sunshinetours

00ec25 wrote: »

yes he is which is why you must report him to HMRC otherwise you are at least morally guilty of being as opportunistic as him in trying to extract money from the situation

In fairness to OP we don't know if he defrauding money from them as we don't know what the quote originally specified (ie VAT included etc), hence my comments that the Op was not actually being defrauded here. We do seem to be pretty sure that the builder however is not paying over VAT toHMRC and as you also say that should be reported now that OP has serious suspicions

if the contract was for a fixed price then you are entitled to an itemised priced list of the variations which he has now claimed for and you can then argue with him (ultimately in court) whether they are in or out of the contract. If he simply wants a lump sum becuase he got his original price wrong then tell him to sue you as you have (apparently) got a fixed price contract

If OP wasnt to play hardball they don't really have to pay anything extra do they though. Its hardly like the builder is going to sue them if he is committing VAT fraud! AS someone else said throw him and his tools off the job and get someone else in to quote to finish the work

every builder in the country will try to claim extra costs if they can, it's the way of the world and no they will not necessarily inform you if you don't ask for a progress report as why would they want to provoke trouble in advance? this is what project management is about - keeping on top of progress and costs

Indeed this is why builders get such a bad name. There shouldn;t be any trouble if the contract and variations have been explained beforehand. As a professional I don't do work for someone if i explain it will cost this and they don't agree

jimbo88_2

macman wrote: »

Look, he quoted you this job back in September? He knew then how long it would take him to build it and as a (presumably) experienced builder he knew how much material price were likely to rise during construction. The only other factor since then has been a 2.5% VAT increase in January, but he knew about that when he quoted. Unless the contract specifically allowed for material increases, he can't charge you any extra for them. And even if he could, he should be able to explain how that breaks down.
I am going to repeat my earlier question-what percentage of the original quote does this £3K increase represent? I'm guessing much more than 10%?

The percentage is 14%.....

macman

So he's wanting to charge you £3K extra on a £21.5K job for material price rises? Let's give him the benefit and assume that half the job cost is materials. So he's therefore claiming that building materials have increased nearly 30% in price since September? And you're even considering paying this to him?

jimbo88_2

macman wrote: »

So he's wanting to charge you £3K extra on a £21.5K job for material price rises? Let's give him the benefit and assume that half the job cost is materials. So he's therefore claiming that building materials have increased nearly 30% in price since September? And you're even considering paying this to him?

Well, no we're not considering paying this to him! But I still need to think what to do about it, whether he can charge me that- whether I should say I'm not paying it!..whether to keep him onside and give him abit of money...or how to say it without being offensive....and what the consequences would be afterwards!

I guess if I was going to be harsh, I can say no payment for this extra £3k you ask for...and see what the fallout would be. Like I said, I don't want any damage to my house!!...and I am not scared to go down the legal route, if needs be. But obviously, I would hope he wouldn't want to go that way.....

jimbo88_2

....and when you're dealing with quite a upfront, burly man....might be best not to use harsh tones!!:)

Premier_2

sunshinetours wrote: »

Sorry there are two sides here

If the builder is invoicing you and quoted you a price including VAT and that is what he has basically invoiced you (ignore the extras at this stage) then he hasn't defrauded you of any money. ...

A builder, or anyone else, cannot add VAT to their bill unless they are VAT registered.

What I don't understand is that the OP is reluctant to report this person who is stealing not only their but my money (in the form of tax evasion), or why they agreed to make cheques out to someone other than the tradesman/company. Why even bother checking up on the status of the VAT registration if they are not prepared to report the matter now they find he isn't VAT registered?

jimbo88_2

Premier wrote: »

A builder, or anyone else, cannot add VAT to their bill unless they are VAT registered.

What I don't understand is that the OP is reluctant to report this person who is stealing not only their but my money (in the form of tax evasion), or why they agreed to make cheques out to someone other than the tradesman/company. Why even bother checking up on the status of the VAT registration if they are not prepared to report the matter now they find he isn't VAT registered?

Hmm...because we don't want to cause any serious problems?? The builder has family and kids, he's been made bankrupt once...and he would obviously know who would have reported him?

It's quite easy for people reading this, to view things in black and white, throw the book at the situation and problem solved....

booty40uk

Hi

With the greatest of respect, you are mad. This builder is, regardless of the standard of work, stealing from you. Tell him you are not paying the extra for materials and that you want your "VAT" money returned or you will report him...............end of.

Andy