Vat reduction on wedding?

Dianchi

I’m not 100% where I stand on this. 

We are due to get married end of next Month provided restrictions ease further, however I reached out to the venue to ask on VAT reduction as in our contract it states that prices “are subject to current VAT Rate and can change”.

They have advised that due to rising costs this VAT reduction is to help them and will not be passed onto us?
Is that correct?

We have not yet paid in full but have paid some % in accordance with our contract 

Jeremy535897

If you have a contract that states a specific price plus VAT, then they should charge VAT at the rate prevailing at the tax point of the supply. In that case, if the tax point of the supply is after the rate change, the benefit would pass to you. (As a rough rule, the tax point is generally the earlier of the invoice date and payment date). It will depend on what the terms and conditions say. The wording you quote must mean that, otherwise why would prices be subject to change? The fact that the term is to protect them in the event of a rate rise is irrelevant, as is their argument that the VAT rate reduction is to help them.

paddyandstumpy

My wife works in hospitality, and had a similar discussion at work yesterday. They've interpreted the VAT reduction as helping the industry by giving them more margin, rather than by enabling them to reduce prices. 

Don't forget, most venues have lost most of their wedding 'season' where a large proportion of their income (profit) is made. 

They feel it's to allow them to recoup lost revenue, without effecting the price charged to the customer. 

bradders1983

You were happy to pay the old rate and the old amount, would you offer to pay the venue more if the rate had gone up?

silvercar

bradders1983 said:

You were happy to pay the old rate and the old amount, would you offer to pay the venue more if the rate had gone up?

If VAT had gone up, would the venue be asking for more money?

Dianchi

silvercar said:

bradders1983 said:

You were happy to pay the old rate and the old amount, would you offer to pay the venue more if the rate had gone up?

If VAT had gone up, would the venue be asking for more money?

They definitely would be!!

Dianchi

bradders1983 said:

You were happy to pay the old rate and the old amount, would you offer to pay the venue more if the rate had gone up?

From the dealings we have had with them they would have put up the costs!

If we were to delay to next year we were going to have to pay a higher rate AND pay this year!

Jeremy535897

If the VAT rate had gone up, I am sure the venue would have passed it on. It is not a question of interpreting what the government is trying to achieve. It is a blunt instrument. Where businesses have the choice as to whether to pass the VAT cut on to customers, they will take the business decision that feels right. Some will keep prices constant, and keep the benefit directly. Others will pass some or all of it on in reduced prices, in the hope of increasing turnover. Where the business has no choice but to pass the benefit to the customer, because of an existing contract, they cannot choose to change the contract unilaterally because they think the government meant to benefit them rather than the customer.

bradders1983

silvercar said:

bradders1983 said:

You were happy to pay the old rate and the old amount, would you offer to pay the venue more if the rate had gone up?

If VAT had gone up, would the venue be asking for more money?

That is not what I asked

Dianchi

bradders1983 said:

silvercar said:

bradders1983 said:

You were happy to pay the old rate and the old amount, would you offer to pay the venue more if the rate had gone up?

If VAT had gone up, would the venue be asking for more money?

That is not what I asked

I would have no choice to pay as they would state it’s covered In contract 

bradders1983

By all means moan at them for a reduction but this could have two impacts:

1) sour relations further
2) a long shot but the money they give you back being the difference between them going bust or not.

I have 6 hotels booked for next month, none paid for, however I was happy with the price I was quoted and clearly you were when you booked the wedding. Yes I am aware this is a money saving website but as Jeremy says, the tax point for the business will have been the invoice date.