Is that right.

[twinpot]

I pay for my mooring quarterly,so my next payment will be for the period 1st Jan to the 31st march,on the 4th Jan the vat goes up to 20%,on the bill they have dated it 5th Jan and charged 20% vat,should that not have been dated 1st Jan and charged 17.5% vat for that quarter then 20% on 1st April.

Twinpot.

[furnessvale]

I pay for my mooring quarterly,so my next payment will be for the period 1st Jan to the 31st march,on the 4th Jan the vat goes up to 20%,on the bill they have dated it 5th Jan and charged 20% vat,should that not have been dated 1st Jan and charged 17.5% vat for that quarter then 20% on 1st April.

Twinpot.

 

I am no great expert but I think you are correct. I believe the invoice date sets the VAT rate. HMRG take a dim view of postdating invoices to avoid paying too much tax so I would equally expect them to take a dim view of postdating to increase tax.

 

George ex nb Alton retired

[cotswoldsman]

I pay for my mooring quarterly,so my next payment will be for the period 1st Jan to the 31st march,on the 4th Jan the vat goes up to 20%,on the bill they have dated it 5th Jan and charged 20% vat,should that not have been dated 1st Jan and charged 17.5% vat for that quarter then 20% on 1st April.

Twinpot.

 

They should charge you 17.5% up to 4 January and 20% after that date.

[jelunga]

I pay for my mooring quarterly,so my next payment will be for the period 1st Jan to the 31st march,on the 4th Jan the vat goes up to 20%,on the bill they have dated it 5th Jan and charged 20% vat,should that not have been dated 1st Jan and charged 17.5% vat for that quarter then 20% on 1st April.

Twinpot.

 

Yes, if the charge is due on 1st Jan, the invoice should be dated and vat charged at old rate. Looks like a scam to me so that they have the higher amount of VAT in their account to earn interest until they have to remit to HMRC.

 

Even BW charged the lower rate of VAt on my boat license due on 1st Jan!!

[cotswoldsman]

I am no great expert but I think you are correct. I believe the invoice date sets the VAT rate. HMRG take a dim view of postdating invoices to avoid paying too much tax so I would equally expect them to take a dim view of postdating to increase tax.

 

George ex nb Alton retired

 

Think that is wrong as it is for a service provided after 4 January it is not like buying say a TV and paying on 4 Jan even though it might not be delivered until 5 jan. This invoice is for a service that will be provided after 4 jan.

[jelunga]

They should charge you 17.5% up to 4 January and 20% after that date.

 

I disagree. If the invoice is for mooring from say 1st Jan to 31st March, and the invoice is dated 1st Jan then the whole period should attract VAT at the 17.5% rate. Even if you pay the invoice after the VAT rate increases, it is the date of the invoice that decides what the VAT rate is.

 

Think about it logically. If you paid for a years mooring in advance, the invoice would show a VAT rate of X%. If during the year the VAT rate changed, businesses cannot be expected to go through all their invoices and charge extra for services already invoiced and paid for.

 

QED

Edited December 30, 2010 by jelunga

[cotswoldsman]

 

 

Even BW charged the lower rate of VAt on my boat license due on 1st Jan!!

 

Think boat licence is different a mooring is rent and if you own a property where you charge rent then the new rate has to be applied from 4 jan

[jelunga]

Think boat licence is different a mooring is rent and if you own a property where you charge rent then the new rate has to be applied from 4 jan

 

But not if you have paid in advance as my previous post.

[cotswoldsman]

But not if you have paid in advance as my previous post.

 

This is a invoice for a service provided after 4 January if it is all invoiced at 20% you can apply for a rebate of 2.5% for the first 4 days

 

From HMRC guide lines.

 

3.2 Goods or services provided before 4 January

2011

The change of rate rules may be used where you provide goods or perform

services before 4 January 2011 and raise a VAT invoice and, in some cases,

receive a payment after the rate change.

So, for example, if you issue a VAT invoice on or after 4 January 2011, for goods

you provided, or services that you completed before 4 January 2011, you can, if

you wish, apply the 17.5 per cent rate.

You can decide to apply these rules even after you have issued a VAT invoice

showing 20 per cent VAT. If you do, you must issue a special credit note giving

credit for the extra 2.5 per cent VAT, within 45 days of the rate change (i.e. by 17

February 2011). The credit note details required are given in section 2.5 above.

You should not cancel the original invoice.

 

[jelunga]

This is a invoice for a service provided after 4 January if it is all invoiced at 20% you can apply for a rebate of 2.5% for the first 4 days

 

From HMRC guide lines.

 

 

 

I do not dispute that. But, if the invoice is dated, as it should be in this case, before the 4th Jan, i.e. before the rate change, the old rate applies to the invoice in total. Read closely your quote, it says

 

The change of rate rules may be used where you provide goods or perform

services before 4 January 2011 and raise a VAT invoice and, in some cases,

receive a payment after the rate change.

 

I think where we disagree is due to the actual date of the OP's invoice, whereas I was commenting on the date it should have been raised.

Edited December 30, 2010 by jelunga

[cotswoldsman]

I do not dispute that. But, if the invoice is dated, as it should be in this case, before the 4th Jan, i.e. before the rate change, the old rate applies to the invoice in total. Read closely your quote, it says

 

The change of rate rules may be used where you provide goods or perform

services before 4 January 2011 and raise a VAT invoice and, in some cases,

receive a payment after the rate change

 

Ok suggest maybe you read the HMRC Guidelines and then interpret them the way you wish I am just giving my opinion and it seems we disagree just one more quote from the Guidelines

 

Effect on businesses – what you need to do

This change affects any VAT registered business that sells or purchases goods or

services that are subject to the standard rate of VAT.

You should charge VAT at the rate of 20 per cent on any sales of standard rated

goods or services that you make on or after 4 January 2011.

 

I think where we disagree is due to the actual date of the OP's invoice, whereas I was commenting on the date it should have been raised.

 

That is correct with purchase of goods in this case he is paying for a service provided after 4 january and is therefor subject to 20% after 4 january

 

I disagree. If the invoice is for mooring from say 1st Jan to 31st March, and the invoice is dated 1st Jan then the whole period should attract VAT at the 17.5% rate. Even if you pay the invoice after the VAT rate increases, it is the date of the invoice that decides what the VAT rate is.

 

Think about it logically. If you paid for a years mooring in advance, the invoice would show a VAT rate of X%. If during the year the VAT rate changed, businesses cannot be expected to go through all their invoices and charge extra for services already invoiced and paid for.

 

QED

 

But in this case it is invoiced after the Emergency Budget with the knowledge of the VAT increase that means it has to be invoiced at the 20% for services after 4 january had he been invoiced and paid before the Emergency Budget for 1, 2, or 20 years then he would only have had to pay 17.5%

Think of your Logic if that was correct then he could pay 10 years marina fees at 17.5% and by year 5 VAT will most probably be 30%

[jelunga]

Ok suggest maybe you read the HMRC Guidelines and then interpret them the way you wish I am just giving my opinion and it seems we disagree just one more quote from the Guidelines

 

 

 

 

 

That is correct with purchase of goods in this case he is paying for a service provided after 4 january and is therefor subject to 20% after 4 january

 

 

But only if it is invoiced after the 4th Jan. For example, I pay for my caravan to be stored. The annual payment is due and is invoiced on the 1st January. it is invoiced at 17.5%, since that is the prevailing rate of VAT at the invoice date. I am not going to have to pay for the rest of the years storage after the 4th Jan at the higher rate since I have already settled the invoice. obviously, if I was paying monthly, and they invoiced me monthly, then if the Jan invoice was dated 1/1/10 then I pay for all of Jan at 17.5%. Then on 1/2/10, when I get the Feb invoice and subsequently, it will be at 20%.

 

Similarly, my phone bill is pre paid for the line rental. So January's line rental is charged at 17.5%. Subsequent line rentals will be charged at 20%.

 

I am sure we do not disagree, we are just not understanding what the other is saying.?????

[cotswoldsman]

But only if it is invoiced after the 4th Jan. For example, I pay for my caravan to be stored. The annual payment is due and is invoiced on the 1st January. it is invoiced at 17.5%, since that is the prevailing rate of VAT at the invoice date. I am not going to have to pay for the rest of the years storage after the 4th Jan at the higher rate since I have already settled the invoice. obviously, if I was paying monthly, and they invoiced me monthly, then if the Jan invoice was dated 1/1/10 then I pay for all of Jan at 17.5%. Then on 1/2/10, when I get the Feb invoice and subsequently, it will be at 20%.

 

Similarly, my phone bill is pre paid for the line rental. So January's line rental is charged at 17.5%. Subsequent line rentals will be charged at 20%.

 

I am sure we do not disagree, we are just not understanding what the other is saying.?????

 

Life is to short will just agree to disagree was just giving my interpretation of the new rules I am no Tax Expert.

[Laurie Booth]

I have paid for my moorings 18 months in advance and have paid 17.5% VAT.

[jelunga]

Life is to short will just agree to disagree was just giving my interpretation of the new rules I am no Tax Expert.

 

John,

 

I also have no wish to upset anybody, just trying to get the info right for the OP

 

Look at page 42 of this link http://www.hmrc.gov.uk/vat/forms-rates/rates/rate-rise-guidance.pdf

 

it all depends on the "tax point" for the invoice. if the service is actually invoice before the 4th Jan, even if the service extends past the 4th jan, then 17.5% should be charged.

 

IMHO

[dor]

If the invoice is dated 01/01/11 for say the year's mooring starting on the 1st Jan, then vat at 17.5% on the whole amount is correct, as it is the invoice date that determines the rate. However, if the invoice was raised on 01/01/11 for the mooring which actually started on 01/02/11, then that comes within the scope of HMRC's fiddle spotters and they may well say that 20% has to be charged, even though the invoice is dated before the vat increase.

 

It is hardly worth the marina charging the higher rate as given by the OP with current interest rates being what they are. I would dispute it with them, although as the invoice is dated 5th Jan, the rate they are applying is correct. The question is why they can't date the invoice on the 1st (or 2nd) - it doesn't have to be dated on a working day.

[Allan(nb Albert)]

From Important Information For Licence Holders, December 2010 (this document will have been sent out as part of the licence renewal pack for boats with licences expiring on 31st January 2011)-

 

VAT RATE INCREASES TO 20%, 4TH JANUARY 2011

 

Your renewal notice includes VAT at the new 20% rate, but if your application and payment reaches us before 22 December - or you pay online on or before 4th January 2011 - we will process it at 17.5%.

I wonder if this is legal as the invoice point will still be the same however payment is made.

 

Needless to say my licence renewal pack arrived on the 23rd December.......

[ditchcrawler]

I pay for my mooring quarterly,so my next payment will be for the period 1st Jan to the 31st march,on the 4th Jan the vat goes up to 20%,on the bill they have dated it 5th Jan and charged 20% vat,should that not have been dated 1st Jan and charged 17.5% vat for that quarter then 20% on 1st April.

Twinpot.

Have you paid it yet and do you intend to pay it before the 4 Jan.

[Allan(nb Albert)]

Have you paid it yet and do you intend to pay it before the 4 Jan.

 

No and Yes!

[Timleech]

Have you paid it yet and do you intend to pay it before the 4 Jan.

 

I don't think there's any requirement for payment to be made before 4th Jan provided it's made within normal credit terms for that business and provided invoicing before 4th would also be 'normal'.

 

Tim

[twinpot]

Have you paid it yet and do you intend to pay it before the 4 Jan.

I only recieved it this morning,so if i post it tomorrow it will not leave our post box till 5pm,and with Monday being a bank holiday i dought if they will recieve it before the 4th,but my take on this is they should have invoiced it for the 1st of Jan and charged me 17.5% vat,all other invoices have been from the first of the month.

Twinpot.

[daveb]

The last couple of VAT rate changes have occurred on the first of the month. This time, it's been applied on the first working day of the month, and this has caused a lot of unnecessary confusion, especially in the area of repeat billings for a continuous supply, which is what the OP has received.

 

The tax point for a continuous supply is set to the earlier of the date of start of supply and the invoice date. Normally, the two will be the same. If the bill is for a supply which starts on 1st Jan 2011, the tax point is 1st Jan 2011 so the VAT rate should be 17.5%. If the supply were to start on or after 4th Jan 2011, the VAT rate OUGHT to be 20%.

[the grinch]

I pay for my mooring quarterly,so my next payment will be for the period 1st Jan to the 31st march,on the 4th Jan the vat goes up to 20%,on the bill they have dated it 5th Jan and charged 20% vat,should that not have been dated 1st Jan and charged 17.5% vat for that quarter then 20% on 1st April.

Twinpot.

 

yes if you always get billed on the first of the month then you should get billed the same for this period

 

to work out the vat at 17.5% you need to multiply the net figure x7 and divide by 47

the new 20% stealth tax is x1 divide by 6 this is the HMRC laid down formula

 

if it was me i would deduct the 2.5% vat increase send them a cheque for the lower amount stating that it is in full settlement of the period at 17.5% and that they have no right to charge at the higher rate

i doubt they will challenge it. if they do complain to HMRC they WILL get an inspection which will cost them time and money.

[jelunga]

yes if you always get billed on the first of the month then you should get billed the same for this period

 

to work out the vat at 17.5% you need to multiply the net figure x7 and divide by 47

the new 20% stealth tax is x1 divide by 6 this is the HMRC laid down formula

 

if it was me i would deduct the 2.5% vat increase send them a cheque for the lower amount stating that it is in full settlement of the period at 17.5% and that they have no right to charge at the higher rate

i doubt they will challenge it. if they do complain to HMRC they WILL get an inspection which will cost them time and money.

 

 

Hear hear!

[cotswoldsman]

Well I decided a while ago to agree to disagree but carried on looking at rules for VAT (I know very sad) I did find these 2 rather interesting bits

 

1. This one is for caravans and is the requirement to be VAT Exempt

 

The provision of pitches at:a) permanent residential caravan parks;

sites for travellers; and

c) seasonal sites but only:

 

 

• where the site is not advertised or held out for holiday use; and·
• where the caravan can be used as a principal private residence. (This applies even if it cannot be occupied throughout the year due to a time-related restriction or occupancy imposed by the site owner.)

 

2. This is for House Boat Moorings

 

7.6 Moorings for houseboats

If you supply a mooring for a houseboat the mooring is exempt.

 

If you supply a mooring for any other type of vessel, then your supply is standard-rated unless it qualifies for zero-rating as explained in Notice 744C Ships and aircraft.

Edited December 31, 2010 by cotswoldsman