Orange contracts VAT help

me+3

I need some help with my phone bills, i have started 2 new contracts in august, one for me and one for my son.

Just checking through the bills and it seems they are charging VAT on top of our contracts for example my sons is supposed to be 15.50 per month yet this month is £19.80. This line hasnt been used since august as my son lost the phone after only having it 2 weeks and i cant afford to replace it. So i know its not call charges or anything.

Can they do this? I signed up to a 15.50 a month contract, nowhere did it mention VAT would be extra or i wouldnt have started it, i cannot afford what they are trying to charge me.

Mine is supposed to be 37 a month, well thats what i signed up for and yet this month is 37 and then 7.44 on top VAT.

Also they are charging me 2.98 for each line a month because i am not paying by direct debit :eek: I mean nearly 6 quid a month extra because i prefer to pay weekly on their website is just ridiculous. I knew there was a charge but for each line when i am the same person??

Sorry if some of my sums dont make sense i have learning difficulties and cant do numbers at all.

Hope someone can help, TIA

LeeSouthEast

I'm sure someone more knowledgable will be along shortly, but as far as I am aware businesses don't have to include VAT in their prices (but it should be made clear they are exclusive if so). However, the Advertising Standards Authority has ruled that prices must be clear so as not to be misleading, so you may have a case.

Most providers charge you extra to pay by anything other than direct debit. £3 isn't excessive but it will add up. Switch to DD and save yourself the effort and the fee.

NFH

me+3 wrote: »

Can they do this? I signed up to a 15.50 a month contract, nowhere did it mention VAT would be extra or i wouldnt have started it, i cannot afford what they are trying to charge me.

Are you sure they're not charging you for more than a month? It is common for a first bill to cover a period of more than one month. Excluding VAT from prices given to consumers would be a breach of Articles 1 and 4 of the Price Marking Order 2004, Regulation 6(4)(d) of the Consumer Protection from Unfair Trading Regulations 2008 and possibly Regulation 7(1)(a)(iii) of the Consumer Protection (Distance Selling) Regulations 2000.

me+3 wrote: »

Also they are charging me 2.98 for each line a month because i am not paying by direct debit :eek: I mean nearly 6 quid a month extra because i prefer to pay weekly on their website is just ridiculous.

They can only surcharge by the additional costs to them of processing your payment, not £2.98 per month. If, for example, they levy a surcharge when you pay by bank transfer which costs them zero, it would be a breach of the Consumer Rights (Payment Surcharges) Regulations 2012, given that the contract started after 6th April 2013 when these regulations came into force.

NFH

LeeSouthEast wrote: »

Most providers charge you extra to pay by anything other than direct debit. £3 isn't excessive but it will add up.

It is excessive and also illegal.

LeeSouthEast

NFH wrote: »

It is excessive and also illegal.

Not really illegal. There is caselaw supporting, BT have been taken to court several times and won every occasion (to my knowledge). Most providers avoid any legal doubt by writing it in to the contract, and also terming a DD payment a discount, rather than adding a non-DD fee. Swings and roundabouts, but I doubt what Orange are doing is illegal.

Happy to be proved wrong though!

grumbler

LeeSouthEast wrote: »

Most providers avoid any legal doubt by writing it in to the contract,

Writing something to a contract doesn't stop this being excessive and, if so, unlawful.

and also terming a DD payment a discount, rather than adding a non-DD fee.

Any example(s)?

grumbler

me+3 wrote: »

... it seems they are charging VAT on top of our contracts for example my sons is supposed to be 15.50 per month yet this month is £19.80.

Doesn't seem to me as 19.80/15.50=1.28

As pointed out above, most likely it's just the first bill typically covering more than one month.

NFH

LeeSouthEast wrote: »

Not really illegal. There is caselaw supporting, BT have been taken to court several times and won every occasion (to my knowledge). Most providers avoid any legal doubt by writing it in to the contract, and also terming a DD payment a discount, rather than adding a non-DD fee. Swings and roundabouts, but I doubt what Orange are doing is illegal.

The Consumer Rights (Payment Surcharges) Regulations 2012 state unambiguously "A trader must not charge consumers, in respect of the use of a given means of payment, fees that exceed the cost borne by the trader for the use of that means". As explained on page 13 of BIS's guidance, discounts are allowed but only if the discount reflects the savings to the business. Therefore it makes no difference whether the price differential is a surcharge or a discount.

Are you sure that BT have been taken to court over contracts that started on or after 6th April 2013? Which have found widespread flouting of the new regulations and have provided a page where you can report companies who do so. Many large companies are continuing to make these surcharges, even though they are now unlawful. The assumption that "if a large company does something then it must be lawful" is very misguided.

scheming_gypsy

If you look at your bill online it'll show the contract charge and (excluding VAT) next to it. Mine does.

So you'll either have £15.50 (excluding VAT) or a lower figure excluding VAT.

NFH

LeeSouthEast wrote: »

Most providers avoid any legal doubt by writing it in to the contract, and also terming a DD payment a discount, rather than adding a non-DD fee.

Where do you get this drivel from? Even Ofcom's guidance (see sections 6 to 8) states:

Our position is that this doesn't make any difference. If consumers have the option, for example, to pay 15 a month (direct debit) or 18 a month (non-direct debit) our view is that the issues remain the same, irrespective of whether the 3 difference is called an additional charge or a discount. The same rules apply in both cases.

simax

The contract would be £15.50 including VAT.

£3.58 is the non DD charge, per line.

Do you have an Itemised bill? If so that's £1.53 per account.

Any other charges outside of the allowance?

Provide us with a full breakdown of the bill so we can see where the charges have arisen.