Roofer Invoice Charging VAT but No VAT Number

Section62

MapleTrees said:

I'm thinking of sending this as my reply:

"Dear xxxxx,

Many thanks for the invoice.

Our original quotation states the total price as VAT n/a.

I understand that between the time you quoted and the time you commenced the job you’ve registered for VAT. I believe you mentioned your registration occurred last month.

I feel this will have given you ample time to notify us of the 20% price increase above the agreed figure. In doing so we would have had an opportunity to reject or accept the new quote depending on our budget. I’m concerned that we were not given that opportunity and we’ve received an invoice for a figure much higher than previously agreed.

My understanding is that VAT shouldn’t be added to an invoice if it wasn’t included on the agreed quote.

I do understand that simple oversights can occur and I think your invoice should now state services as £708.33 and VAT as £141.67.

Kind regards,  "

I think that's fair.  Did you find the scaffolder independently, or did the roofer point you in their direction?  If the latter, it might be worth having a chat with the roofer before sending the email to the scaffolder.

grumbler

badmemory said:

Well Tescos used to but no longer do, however Home Bargains & Aldis still do as do Tescos Express.

Lidl don't too.

I'm sure any VAT- registered business can get a VAT receipt/invoice from any other VAT-registered company, including Tesco and Lidl, if they need it. However, most their customers aren't  businessed and don't need them. And I'm sure they don't breach any laws by not providing VAT invoices to everyone. Screwfix and Toolstation do this by default because many/most their customers are businesses.

Section62 said:

grumbler said:

Section62 said:

grumbler said:

Risteard said:

grumbler said:

Risteard said:

maisie_cat said:

As I understand it, if the work was completed prior to his registration there is no VAT due as the tax point is the earlier of completion and invoice date.
If the work is completed post registration but the quote was clearly excluding VAT then the VAT is payable

VAT liability will be at the prevailing rate at the date of invoice.

VAT liability is the liability of the tradesperson. Non-business customers don't care about VAT and don't need to care. What they care about is the total amount they were quoted originally and agreed to. If the liability arose after the quote, but before the invoice, it's not the customer's problem.

That has nothing to do with what I was saying. My point is that an invoice issued after the VAT registration date legally must include VAT.

Is this a fact? I'm no expert, but "You must use VAT invoices if you and your customer are VAT registered."
https://www.gov.uk/invoicing-and-taking-payment-from-customers/invoices-what-they-must-include

In this case the customer is obviously not a business, can't claim VAT, doesn't care about it and doesn't need an invoice stating VAT. The invoice can include VAT as a part of the total amount, but I don't think it must.

Yes -

Yes what? Are you saying that the information I quoted is incorrect? At least I provided a link. You didn't. 
Tesco "sell goods and services". Do they show VAT on all invoices/reciepts?

Yes, the text I quoted can be found in the same place your link points to, the official government website.

Which confirms what Risteard posted is a fact.

No, it doesn't - at least because the information 'in the same places' seems to be contradictory.  Neither does it confirm that what he said isn't a fact.

And it's just common sense - only those customers who can claim VAT need these VAT invoices. Why issue them if they don't need them? 

A VAT-registered trader/supplier, possibly, always needs them for a record because some goods/services they sell may be exempt from VAT or the rates can vary.

ETA: as I said, I'm no expert, but this this discussion between experts seems to prove my point and agrees with my common sense - https://community.hmrc.gov.uk/customerforums/vat/c9bb98d6-bbf5-ed11-a81c-002248c5fcce

MapleTrees

Section62 said:

I think that's fair.  Did you find the scaffolder independently, or did the roofer point you in their direction?  If the latter, it might be worth having a chat with the roofer before sending the email to the scaffolder.

The roofer uses a few different scaffolders (I think) and would have selected him for this job. So all we had to do is get in touch with the scaffolder, with the job reference, and he sent the quote by email. I'm not sure if our contract is with the scaffolder or via the roofer (my husband took on this project so I'll have to ask him). 

badmemory

Back in the day when I used to buy the consumables I used to attach notes (after the first accountants complaint) that I could have got this with a VAT invoice but it would have cost way more than the goods billed.  Never complained again.

MapleTrees

I'm about to send this note to the scaffolder, though part of me wants to wait until the scaffold has been removed. There wasn't a due by date on the invoice so I may have a couple of days.

"Dear xxxxxxxxx,

Apologies for the slight delay in coming back to you, and many thanks for the invoice.

I’ve just noticed a discrepancy with the final figure. Our original quotation states a total price, with VAT set out as not applicable. VAT at 20% has been added to our invoice.

I understand that between the time you quoted and the time you commenced the job you’ve had to register for VAT. You would indeed need to add VAT to quotes after your registration date. However we proceeded under an already agreed quotation (which clearly stated VAT n/a) so I believe your invoice should now state services as £708.33 and VAT as £141.67.

Regards,"

MapleTrees

The response I've just received was:  "If I don't try and add vat to all my old quotes I'll lose out on £1000s.

I'll adjust the invoice tonight and resend it."

Crikey.

Should I even respond to this?  Or I could politely point out the rules - in case he genuinely doesn't know that it's illegal to invoice for VAT without raising a new quote first for the client to agree?

MapleTrees

I did respond to the scaffolder, just in case he wasn't aware of the rules. At least that's how I couched it, so he got the benefit of the doubt. But I suspect by virtue of the fact he is adjusting the invoice and resending it that he may well know what he's doing.

I would imagine I'm not the only customer who will query their invoices.

I wonder how common this is. A few years ago I got a quote for a new bathroom with VAT set out on the quote, but the trader wasn't actually VAT registered. That was quite worrying because he was a fairly high end business.

Section62

MapleTrees said:

Should I even respond to this?  Or I could politely point out the rules - in case he genuinely doesn't know that it's illegal to invoice for VAT without raising a new quote first for the client to agree?

I have my doubts it is "illegal" to do what the trader has done.  The relevant legislation is designed to deal with traders who deliberately set out to con customers.  It doesn't make any provision for situations where there is a change of circumstances, for example becoming VAT registered.

In any event, I doubt the enforcement authority (probably the local authority in this case) would have any interest in prosecuting an otherwise honest trader who found themselves caught in the VAT registration trap.

The trader has done wrong in not communicating to you that he would now have to add VAT to the previously quoted price, but has corrected that by (apparently) taking the loss himself.

With regard to the bathroom quote, you don't have to be VAT registered to include a VAT line on a quotation.  What you can't do is to charge VAT on your own work: that is unlawful if you aren't VAT registered.  But for example it wouldn't be unlawful to quote on the basis of "Bathroom fittings, tiles, materials etc = £10000,  VAT on above = £2000,  Labour £1000" - in other words showing that £2000 of the bill would be VAT paid on materials etc that had to be purchased.  Sometimes traders who do this don't make it clear the VAT is on what they are buying, not their own work... but I don't know whether that is what happened in your case.

MapleTrees

New response from the scaffolder:

"xxxxx,

I know I've added VAT to the invoice and not the quote because I sent the quote out before I had to register for Vat.

All customers so far understand why I've added the extra 20% but like I said in the previous email I will change the invoice and resend tonight.

Not sure why you felt the need to send that legal statement! I'm not trying to con anyone, I don't even get to keep that 20%.

You will receive the invoice tonight as quoted with out the extra 20%.

xxxxx"

Regarding the 'legal statement' - I sent him a link to the legislation in case he wasn't aware of it, and even suggested his accountant might have misadvised him. 

MapleTrees

Section62 said:

MapleTrees said:

Should I even respond to this?  Or I could politely point out the rules - in case he genuinely doesn't know that it's illegal to invoice for VAT without raising a new quote first for the client to agree?

I have my doubts it is "illegal" to do what the trader has done.  The relevant legislation is designed to deal with traders who deliberately set out to con customers.  It doesn't make any provision for situations where there is a change of circumstances, for example becoming VAT registered.

The trader has done wrong in not communicating to you that he would now have to add VAT to the previously quoted price, but has corrected that by (apparently) taking the loss himself.

The legislation states that a trader is not acting within the law if they add VAT to an invoice when it was not set out on the quotation. So surely it is illegal, as I read that. 

To be clear - there is no prospect I would shop the trader!

A change of circumstances is surely immaterial - there was ample opportunity to communicate that before the work commenced but the trader chose not to.

You say that he is bearing the loss himself, as if I'm unreasonably imposing that on him. In fact he attempted to pass on his new liability to me in a way which removed my right to refuse. He has only corrected that because I have pointed it out to him - again, not unreasonably. 

I've run a small business and if I issued a quote, did the work, and then sent an invoice for substantially more because my suppliers had raised their prices in the interim (which they often did) I think my customers would have thrown the book at me. With an 'estimate' it would have been easier to deal with.