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Vat reduction

8 replies 216 views
fuzzbalsfuzzbals Forumite
1 posts
MoneySaving Newbie
I have booked a weekend away in november, having paid the required deposit, will it be cheaper now that Vat has been reduced to 5%?

Replies

  • bradders1983bradders1983 Forumite
    3.8K posts
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    Probably not given the tax point was at the point you paid the initial sum.  Also the tourism sector is on its knees, they are hardly going to be giving out VAT discounts and you were happy enough to pay the original price.
  • mattyprice4004mattyprice4004 Forumite
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    You booked a break for X price, the price is still X price. 
    No, you are not entitled to the difference; the businesses' VAT affairs are theirs and theirs alone. 
  • tripledtripled Forumite
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    Part of the Furniture 1,000 Posts Combo Breaker Wedding Day Wonder
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    The VAT rate they have to charge is the one at the "tax point" - see https://www.gov.uk/vat-record-keeping/time-of-supply-or-tax-point. They will have to hand over the full 20% to HMRC.

    The only possible way to get around this is if they will allow you to cancel without penalty. You could then re-book from Wednesday at the lower VAT rate (however if they up their prices you wouldn't necessarily be any better off).
  • Hooker_Stewart_-_WHooker_Stewart_-_W Forumite
    3 posts
    Part of the Furniture First Post Combo Breaker
    Please can MSE confirm what the intent of the Chancellor was by reducing the VAT on leisure activities and what companies are expected to do? For example if the hire of a camper van is £1000 for a week inclusive of VAT at 20% now, what should the price to the consumer be once the VAT reduction commences?
  • daveyjpdaveyjp Forumite
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    As Mattyprice states above.

    It will either be £1000 a week inclusive of VAT at 5%, or £874.65 incusive of VAT at 5%.

    The company can decide to do either.

  • Hooker_Stewart_-_WHooker_Stewart_-_W Forumite
    3 posts
    Part of the Furniture First Post Combo Breaker
    daveyjp said:
    As Mattyprice states above.

    It will either be £1000 a week inclusive of VAT at 5%, or £874.65 incusive of VAT at 5%.

    The company can decide to do either.

    Hi Dave,
    Apologies if I'm not getting this, but £833.33 should be the price (ex [email protected]%) to get to £1000 and £833.33 with [email protected]% will be £875 surely?
    However my question to MSE moderators was intended to understand what the government are trying to achieve and what this might mean to consumers.
    Cheers ;-)
  • daveyjpdaveyjp Forumite
    9.3K posts
    Part of the Furniture 1,000 Posts Name Dropper
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    Government have achieved their aim, a temporary reduction in VAT.

    Your maths is correct, but there is nothing to stop the company charging £1,000, then accounting for VAT at 5% giving £50 to HMRC and keeping the £950.  The cost to you is still £1,000. 

    How this is dealt with by companies is a commercial decision for them as Government haven't stated the reduction must be passed to customers.

    Some companies may reduce their charges (Caravan and Camping Club have done for their campsite fees), others may not.




  • Penguin_Penguin_ Forumite
    171 posts
    100 Posts Name Dropper
    Please can MSE confirm what the intent of the Chancellor was by reducing the VAT on leisure activities and what companies are expected to do? For example if the hire of a camper van is £1000 for a week inclusive of VAT at 20% now, what should the price to the consumer be once the VAT reduction commences?

    The price to the consumer would be £1000.
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