VAT Question

Valli

In November a firm of plumbers began a bathroom installation for me. Due to no fault of mine, they have not yet finished and I have not yet been billed, although all parts were ordered last August.

I am now waiting for replacement of damaged parts, after which I assume I will be billed.

My original quote included VAT and would have been calculated at the old rate.

Is it likely I will now be billed for VAT at the new rate and, if so, will I have grounds to contest this?

Installation actually started on 20 November; the delays have been due to bad weather and a mess up by the plumber, along with delivery of a faulty (marked) wash hand basin which has had to be re-ordered and which has not yet been delivered.

bengalknights

As goods were delivered in 2010 and the installation started in 2010 the vat should be 17.5%.

http://www.hmrc.gov.uk/vat/forms-rates/rates/rate-changes.htm#3

Section 3 covers the vat and although this is on about the 15%-17.5% change it applies the same to this year.

Valli

thanks so much for that! being a good money saver I wasn't about to pay up front, I want the job finishing to a high standard!

Mind you I think using my name as your siggy's going a bit far, although you've transposed the 'a' and 'i'

Mikeyorks

Valli wrote: »

Is it likely I will now be billed for VAT at the new rate and, if so, will I have grounds to contest this?

Virtually inevitable you'll be billed at 20%. Paying a deposit / stage payments could have mitigated it. See the links directly above your post (eg) :-

http://www.moneysavingexpert.com/news/shopping/2010/12/beat-the-january-vat-rise

Valli

oh:o:o:(:(

chrismac1

The tax point here will normally be the date of acceptance by you of the installation, so 20%. Contractually, was the price quoted as X or Y plus VAT? If X then tough on the plumber, if Y plus VAT then contractually you are exposed to the VAT rate. However, you should certainly have a good go at getting the guy to accept the hit if the delays were his fault, even if you did not have a liquidated damages clause in the contract. One further thing - in my area plumbers have been snowed under (no pun intended) for the past 3 weeks or more due to frozen pipe issues. If urgent work on flooded properties caused the delay I would be less inclined to really push the guy on the VAT.

Valli

I got a quote for an amount to include VAT - I received the quote by e mail and checked back actually, so the quote (for supply and fitting) was £XXXX inc VAT

The delays have been caused by the weather - the plumber was unable to get here for about a week due to ice/snow then, when he came to fit the hand basin he spotted a fault. He also miscut a panel (to inset the basin) so had to order a new one and never fitted the cabinet doors or bath panel (due to time) intending to fit them when the new wash hand basin was fitted. I'm now waiting for a replacment basin and expect everything to be finished then (crosses fingers).

Mikeyorks

This extract from some detailed guidance issued by HMRC in Dec 2010 may help? But it's up to the company doing the work as to how they play it ...... most will simply add 20% if the invoice / payment is after 4th Jan :

I am a plumber and have been employed to carry out some major works to a house for a private customer. The work commenced in early December 2010 and won’t finish until mid January 2011. How do I calculate the VAT?

[FONT=Arial,Arial][FONT=Arial,Arial]You may account for VAT at 17.5 per cent on the work carried out before 4 January 2011 and 20 per cent on the remainder. You will need to be able to show that your calculation is accurate – perhaps you charge a daily or an hourly rate that you could use to demonstrate this. [/FONT]
[/FONT]

........ it's at para 3.4.2 of the attached if you want to coerce your plumbers?

http://www.hmrc.gov.uk/vat/forms-rates/rates/rate-rise-guidance.pdf

(Sorry - the formatting suddenly decided on a life of it's own!)