Landlord charging 20% VAT on gas bill?

mlz1413

I looked at the CAB link and would say that relates to a domestic property sharing out the energy bill. 

I tried to read the Ofgem link but it was hard to read and compare the many examples on my phone screen but I couldn't see vat specifically addressed. (Apologies if I'm wrong)

So this is my experience.  I used to work for an company that serviced and repaired light aircraft, when fuel was purchased it had 5% vat. If an aircraft was filled with fuel for the owner it was sold at 20% because we weren't selling the fuel we were selling the service of filling the aircraft with fuel.
I had many conversations with owners about this, but to sell fuel you have to be regulated. That regulated company can sell fuel at the tariff set by HMRC. Any other company has to sell the service they provide at 20% or the current tariff set by HMRC.

As this was a highly debated topic I asked HMRC directly and they said I was correct.  

So I think the LL is correct if she is a business. 
IE the business bill is for the whole premises. Then the business invoices all the tenants.  

One of the previous replies said that the name on the Energy bill and the name on the LL invoice need to match and I'd agree with that because it does need to be the same VAT Number.  But it is possible all the companies the LL has are under the same VAT group.

triplea35

mlz1413 said:

Oh right, that's thrown a spanner in the works then! I do believe they operate as a business, attached to the landlords home are two retail premises, a manufacturing premise, all run by the family. Also an office rental, two residential flat lets and my sons cottage, which until he took it on around a year ago had been previously been a holiday let. 
The only paperwork I have seen is a photocopy of the BG bill with the 20% added to the pre VAT total. I know my son is very lackadaisical when it comes to finance.   

mobileron

My bill for a 2 bed cottage is £100 a month,old place solid walls etc.Can he get a wood burner installed.

Catman5000

Am i going mad here or does it just seem a bit mental that an LL would add charges to any bill? It looks like it may be legal to charge 5% for energy (according to CAB) BUT seems a tad immoral.

I was a renter for nearly 20 years and never had any LL tack on a VAT for energy. Surely if you're worried about maintaining your energy utilities in the house, you would include this in the rent? 

In this current climate, seems a bit gross

HampshireH

Catman5000 said:

Am i going mad here or does it just seem a bit mental that an LL would add charges to any bill? It looks like it may be legal to charge 5% for energy (according to CAB) BUT seems a tad immoral.

I was a renter for nearly 20 years and never had any LL tack on a VAT for energy. Surely if you're worried about maintaining your energy utilities in the house, you would include this in the rent? 

In this current climate, seems a bit gross

Presumably you rented with bills included and therefore they incorporated the vat into whatever you were charged?

I don't see why the landlord wouldn't pass on the 5% vat charge if it's the OPs sons bill 

What's not clear here I whether the Landlord is charging a. 20% fee for managing the utilities on behalf of the tenant (very questionable and should probably be a fixed fee detailed in the tenancy agreement if at all) or whether they are trying to claim 20% vat off the OPs son or to make money on the energy use.

Probably be helpful to see the paperwork. If there is a bill detailing use and VAT I'm not sure why the OPs son isn't dealing with his own bills or just paying that exact amount 

Probably better on the energy board though for a full investigation

NeverTooLate

HampshireH said:

What's not clear here I whether the Landlord is charging a. 20% fee for managing the utilities on behalf of the tenant (very questionable and should probably be a fixed fee detailed in the tenancy agreement if at all) or whether they are trying to claim 20% vat off the OPs son or to make money on the energy use.

VAT registered businesses don't have a choice about charging vat on every invoice, they are collecting the tax for the government, not for themselves.