VAT on electricity on a marina mooring

Pogo1234

Hi, I moor my boat in a small residential marina in the north west and the owner is charging us 35p a unit for electricity plus 20% VAT which makes it an eye watering 42p a unit. When asked she said it had 'gone up' and was 'the best deal she could get'. We all think this isn't true and that she's adding money on to this.
So I have two questions.
1. Can she charge us 20% VAT? I was under the impression it had to be 5%.
2. Is she overcharging us or is this a likely amount that she's being charged herself? I read that she can charge us a 'service charge' but not add anything on to the unit charge.
Obviously if she's adding a service charge onto the unit price then the more you use the more service charge you're paying which seems unfair.
I read of another marina charging only 11.5p per unit, by the way. And another charging 14p. So our charge seems to be between 3 and 4 times higher!

[Deleted User]

Hi,


it's 5% for domestic bills 20% commercial.

twhitehousescat

is your boat residential , do you pay counsul tax

btr30

A business user will be charged 5% VAT if daily consumption falls under VAT deminimis level of 33kWh per day (electricity) and 145 kWh per day gas.


If the Marina total metered consumption is in excess of these rates, then the owner will be charged VAT at 20%. However, how they recharge that from their tenants I am not so sure, as their consumption may be below deminimis levels.



ETA - I have looked further into this and a landlord should charge VAT at 5% if utility is sub-metered and consumption levels fall below deminimis


https://www.gov.uk/guidance/vat-on-land-and-property-notice-742


11.7.6 Electricity, lighting and heating

If you make a separate charge for un-metered supplies of gas and electricity used by tenants, it should be treated as further payment for the main supply of accommodation. But where you operate a secondary meter, the charges to the tenants for the gas and electricity they use are consideration for separate supplies of fuel and power. These supplies will be standard-rated unless the fuel supplied is of a de-minimis quantity, in which case the supply will be subject to the reduced rate. See Fuel and power (VAT Notice 701/19) for more information.

Pogo1234

It's really a non residential marina with people who are 'frequent vistors' by which take it that they're residential. So no council tax as none of us have permanent spots - if we go out the owner puts other boats in the gap we've left and we move around from spot to spot quite often.

Robin9

Typically the marina operator will be paying 15p/unit plus 25p/day plus 20% VAT - they are also then allowed to include in their charges the cost of their local cables, switchgear, inc your plug in points again inc 20% VAT

matelodave

Have a read of this and then decide where your situation lies - https://www.ofgem.gov.uk/ofgem-publications/74486/11782-resaleupdateoct05pdf

Andy_WSM

Pogo1234 wrote: »

It's really a non residential marina with people who are 'frequent vistors' by which take it that they're residential. So no council tax as none of us have permanent spots - if we go out the owner puts other boats in the gap we've left and we move around from spot to spot quite often.

So it's a business premises then if it is not a residential mooring, in which case 20% VAT would apply.

Also if the marina has one of those systems where you pay to top up or buy a swipe card then they are allowed to recover that cost from you too and it is not subject to maximum price restrictions.

Bottom line is you don't HAVE to buy electricity on site, although it's convenient, so you pay the price of convenience and the marina have had to buy all the equipment to make it convenient for a supply to be available.

Pogo1234

There are about 8 'residential' boats and the rest not. We use about 3 units a day which should be quite cheap but isn't. Apparently we are supposed to be able to ask to see what our marina owner pays herself, but in practice if we did that we'd be told to leave. Which isn't at all fair as it's our right.

Pogo1234

Sorry, forgot to ask about what anyone thought about the price - you can certainly charge for all the above, but it has to be separately billed to the unit price. It's illegal (I read) to charge more per unit than you are paying yourself. It is individual meters on the marina that are read every so often and then we are billed.

btr30

So at 3kWh per day, VAT should only be chargeable st 5%. Also VAT can only be charged if the Marina owner is VAT registered, and their VAT registration no. must be shown on the invoice.

The rate you are being charged is extortionate, but I can’t comment on the legality.