Quick Q re VAT on postage

emv

VAT isn't payable on Royal Mail postage so I shouldn't be charged VAT on an invoice for the Royal Mail charges element of a bill for storage & postage charges, is that right? Just been sent a lot of invoices after many months of chasing & noticed all charge 20% VAT on top of Royal Mail costs.

Em

motorguy

emv wrote: »

VAT isn't payable on Royal Mail postage so I shouldn't be charged VAT on an invoice for the Royal Mail charges element of a bill for storage & postage charges, is that right? Just been sent a lot of invoices after many months of chasing & noticed all charge 20% VAT on top of Royal Mail costs.

Em

You need to charge VAT on postage, as you are providing a service, even though RM dont charge it.

So if the postage is £5, you'd need to charge your customers £5+VAT.

paddyrg

If you mean 'why am I being charged VAT on the postage element of an invoice sent to me?' then it's because postage was a service provided by the sender, they have to charge VAT, much like they have to charge it on the goods they sent.

IF you are VAT registered, you'll reclaim it anyway. If you aren't, that's just the way it is.

Pennywise

Not all Royal Mail postage is exempt from VAT. Have a look at the Royal Mail webpage:-

http://www.royalmail.com/information-vat-and-postal-services

Aquamania

emv wrote: »

VAT isn't payable on Royal Mail postage so I shouldn't be charged VAT on an invoice for the Royal Mail charges element of a bill for storage & postage charges, is that right? Just been sent a lot of invoices after many months of chasing & noticed all charge 20% VAT on top of Royal Mail costs.

Em

Who is charging you the vat? Presumably someone other than Royal Mail?

This notice explains how suppliers must treat vat for postage and delivery

http://customs.hmrc.gov.uk/channelsPortalWebApp/channelsPortalWebApp.portal?_nfpb=true&_pageLabel=pageLibrary_PublicNoticesAndInfoSheets&propertyType=document&id=HMCE_CL_000114#P29_2179

InsideInsurance

emv wrote: »

VAT isn't payable on Royal Mail postage so I shouldn't be charged VAT on an invoice for the Royal Mail charges element of a bill for storage & postage charges, is that right? Just been sent a lot of invoices after many months of chasing & noticed all charge 20% VAT on top of Royal Mail costs.

If you are selling stamps then you dont add VAT because RM postage is VAT exempt

Post & Packaging however is a service and does attract VAT, the fact that part of the cost may be exempt is irrelevant.