Tax increase on contract

Hintza

We had architects fees due to be paid on completion of the contract (was meant to be March now looking like June). We paid them in December just to avoid a situation such as this.

The venue is not charging you anymore, HMRC are.

fozzeh

Hintza's example is right. If you paid and signed the contract prior to 04/01/11, you're to pay 17.5% VAT. If they've not included it in their year end, their problem with Mr. Taxman and not yours. They shouldn't be trying this on with you.

Hope the wedding goes well!

Equaliser123

fozzeh wrote: »

Hintza's example is right. If you paid and signed the contract prior to 04/01/11, you're to pay 17.5% VAT. If they've not included it in their year end, their problem with Mr. Taxman and not yours. They shouldn't be trying this on with you.

Hope the wedding goes well!

Difference is payment hasn't been made and services haven't been performed.

Mark_Hewitt

They haven't increased their prices, the price they are charging is exactly the same. The inclusive VAT price is shown for the convenience of the customer but does not represent the 'real' price, which is of course that excluding VAT. They haven't changed the terms of the contract - in effect the government has - so they are not in breach of contract in any way.

To be fair the 20% VAT rise wasn't exactly brought in yesterday by surprise.

Flyboy152

Chuck101 wrote: »

Hi All,

I hope I am doing this right - first post eek.

I was hoping that someone would be able to give me some advice. We have recently received a letter from our wedding venue stating that due to the 2.5% tax increase on 4th Jan they will be increasing the pricese stated in our contract.

Are they able to do this/ can we contest? The contract clearly states that we are to be charged 2010 prices and the only clause within our terms and conditions that would allow any such variation of contract would be the force majeure.

I also think that bearing in mind the increase was made in January there has been a huge delay in informing us of the increase.

Any advice or help would be much appreciated

Thanks

Abby

I think HMRC would be considered quite a force majeure.

Flyboy152

Chuck101 wrote: »

Yeah take your point!! Is just so annoying as we could ahve paid the full fee before and not had to incur the extra 2.5% charge.

Thank you though!

Wouldn't have made any difference, the increase would still have been due. The goods/services would have been due for delivery more than six months after the invoice date.

mo786uk

I think it depends on when you signed the contract in relation to when the VAT increase was annouced.

If they knew the rise was coming and didnt adjust their prices then one could argue it was their own fault and they should absorp the difference.

If it came in after than I think they have a case for adding on the extra.

Mark_Hewitt

mo786uk wrote: »

I think it depends on when you signed the contract in relation to when the VAT increase was annouced.

If they knew the rise was coming and didnt adjust their prices then one could argue it was their own fault and they should absorp the difference.

If it came in after than I think they have a case for adding on the extra.

Doesn't make any difference, their prices have not changed!

Equaliser123

Flyboy152 wrote: »

I think HMRC would be considered quite a force majeure.

You have to be careful what you argue! Force majeure relieves the parties from their contractual obligations until the event clears. In this way, the venue wouldn't have to provide the service at all.

Flyboy152

Equaliser123 wrote: »

You have to be careful what you argue! Force majeure relieves the parties from their contractual obligations until the event clears. In this way, the venue wouldn't have to provide the service at all.

I was using the literal translation of "major force," I don't think anyone could describe HMRC as a minor one.