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Thread: Postage and VAT

  1. #1
    Join Date
    Oct 2008
    Posts
    27

    Default Postage and VAT

    Hi,

    We charge 6 shipping fee for any order, but this includes VAT of 0.89p and I would like to remove the VAT in this shipping charge (as I ship via Royal Mail and there is no VAT)

    Is there any way I could achieve this, or not really?

    Thanks in advance.

  2. #2
    Join Date
    Jul 2009
    Posts
    514

  3. #3
    Join Date
    Jan 2009
    Location
    Stockport
    Posts
    58

    Default

    we also use the royal mail to send our orders but you still have to charge the VAT.
    You do not pay it for RM but you have to charge it to the customer (for items that are taxable).

    http://customs.hmrc.gov.uk/channelsP...ument#P34_2182

    Hope this helps

  4. #4
    Join Date
    Nov 2009
    Posts
    1,222

    Default

    As I understand it, you don't charge VAT on the delivery portion of the order, only for the goods. However, say you use a courier that charges you VAT for the service, you do have to declare it with Mr Taxman for your VAT return. So you are right to switch off the VAT for the delivery charge but must charge VAT on the items ordered.

  5. #5
    Join Date
    Oct 2008
    Posts
    27

    Wink

    Thank you for all the info, really appreciated.
    Thanks again everyone.

  6. #6
    Join Date
    Jan 2009
    Location
    Stockport
    Posts
    58

    Default

    Sorry I did not explain this correctly, most of the time (read the HM Revenu link for exemptions) you have to charge VAT on the postage charges , the Post Office is the exeption (they do not have to charge VAT).

    "Postal services provided by the Post Office are exempt from VAT, but this exemption does not extend to similar services provided by other suppliers, even where this might be seen as being in direct competition with the Post Office. However, if any delivery charge you make to your own customers includes the cost of stamps you buy from the Post Office you may have to charge VAT on the whole amount including the cost of those stamps."

    and

    "Similarly, if you deliver the goods by post, the supply of delivery services remains taxable even though the supply to you by the Post Office will be exempt"

    Also this : http://www.ukbusinessforums.co.uk/fo...ad.php?t=47787

  7. #7
    Join Date
    Jan 2008
    Location
    London UK, the world capital of magnetic therapy.
    Posts
    193

    Default

    In the end of the day, the VAT is tax that the government tells businesses to charge consumers for services. Posting is a service.

    As the supreme source of legislation in the land, they can give exempt to whoever they wish - in that case the post office.

    Hereby I offer my vote for sale: I will vote for the party that will promise to give me exemption too. Actually, I will get the whole town voting for them if they will give exemption from VAT for whoever sells magnetic bracelets from Carshalton.
    Eran, selling magnetic bracelets from http://www.magnetic-products-store.com/ The house of magnetic jewellery. Blogging at http://magnetictherapyuk.wordpress.com/ about all issues of magnetic therapy UK.

  8. #8
    Join Date
    Nov 2009
    Posts
    118

    Default

    yep. you gotta charge vat on postage within the EU. so (for example) if royal mail are charging you 4.00 for postage you have to add 17.5% to that otherwise you'll be losing money come the day you have to pay Vat.

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