Conveyancing Invoice, what is VAT Chargeable on?

tomreid10

Hi All, I always found VAT a very complicated area. I'm just at the end of a very long house buying process. I have the final bill from the solicitors and I'm not certain that they are charging the 20% VAT on all the right things.

For example, they tell me that they have to pay the bank £39 to transfer the money to the seller's solicitor. I would assume this should be "passed through at cost" and not marked up by 20%?

Similarly, they say they have to pay a "Stamp Duty Land Transaction Fee" and they have added VAT to this.

Oddly enough they have not added VAT to a bill called "Searches / Office copies".

Any help gratefully received.

cheers

crazyguy

They should only pass on any amount that they have incurred a vat charge against, so no the bank charge should not have vat on top, best bet is to phone them and ask why they are charging vat on things that they shouldnt be !

loubel

VAT is paid on their fees. Their base fees, their fee to send a TT and their fee to draft the SDLT paperwork are all fees and so VAT is payable on them.

Searches and Office Copies are 3rd party disbursements and so no VAT.

Richard_Webster

Filling in the SDLT form is just another charge so you have to pay VAT on it.

The Bank Transfer Fee is generally the charge the solicitor makes for organising it through his own terminal with his bank so it is a mixture of what the bank charges for each transaction, a monthly fee for using the service and the solicitor's staff time inputting the data and dealing with the bank's security requirements. Therefore VAT is chargeable on it.

timmyt

tomreid10 wrote: »

Hi All, I always found VAT a very complicated area. I'm just at the end of a very long house buying process. I have the final bill from the solicitors and I'm not certain that they are charging the 20% VAT on all the right things.

For example, they tell me that they have to pay the bank £39 to transfer the money to the seller's solicitor. yes, like we do £30 plus VAT. But it is more to do with the time it takes another part of the firm to send the money than actually whether the firm gets charged it by the bank. invariably firms do not get charged, and so this is pure profit. hence why it always comes with VAT I would assume this should be "passed through at cost" and not marked up by 20%?

Similarly, they say they have to pay a "Stamp Duty Land Transaction Fee" firms who disguise their main fee to look small, then charge this are naughty...it is pure profit, and so should have VAT. That said, if it is a small amount of £6 plus VAT then this is ok as it is paid to get instant clearance on the sdlt return submission sight...lawyers prefer using this software more than the Inland Revneu's sight as it takes much less time and is very user friendly and they have added VAT to this.

Oddly enough they have not added VAT to a bill called "Searches / Office copies". No they are passed on at cost

Any help gratefully received.

cheers

as a conveyancing solicitor, the answers are in red.