Adding VAT to an invoice after payment?

D

Dancin homer

Guest
Hi hope someone can help me with this...
In November last year we had are house rewired by a qualified electrician at a cost of £2k and payed as soon as we got the invoice which stated, 'Total including materials and labour £2285 No VAT'. Fast forward to April and we get a letter saying that the company ommited to include the vat to all invoices since September 2007. He was 'given a large contract that took hin over the VAT threshold..Which didn't work out... To bear the full cost will certainley close my buisiness'

Does anyone know where we stand with this? the citizens advice weren't 100% but they said we maynot have to pay it but we may get taken to court.

Many thanks
 
I do feel for the guy and probably would cough up the €300 odd (13.5%), If I liked him. it will probably be less as he can claim the 21% back from materials to bring the size of your original bill down.

I would however feel I was under no obligation to pay, as you settled your invoice when if came, The contractor has a responsibility to comply with the revenue, this is not the clients concern if contractor messed up his tax affairs.
 
If he got a big contract I would think it worth his while to pay the E300 quid (I'm trusting your maths here Davy!) himself and just issue you with a new invoice while telling you that there's no need to pay it.
 
Poor planning on the electrician's part, but but tough luck and its not OP's problem. The invoice was presented and paid. Hopefully OP has a receipt, cheque stub, a line on a bank statement or other record of payment in full.

What catches some people out with the VAT registration is the "rolling year" where you need to be looking forward to transactions in the future.
 
Thanks for the quick replys. The VAT invoice was for £342, furtunately we do have the invoice and payment details. If we had the money we prob would pay, but sadly were not sitting on that much money. The problem for the electrician is he would of sent this letter out to all customers from September 07.
 
In Ireland, I didn't think you had to "back-charge" VAT if you subsequently go over the VAT limit. I just thought you had to charge from the time you register - no?
 
A private customer being a non-VAT registered party can expect the invoice presented to be the full and final amount. VAT, where charged is deemed included since, for the private customer it is not recoverable. If the supplier is not charging sales VAT through being under the threshold then the customer is expected to pay only the amount invoiced. The supplier in this case is expecting his customers to pay for his good fortune in getting more work but bad fortune in going over the threshold. That is the supplier's poblem. The customer got a price and paid it. End of story.

Interestingly , as Davyjones mentioned, if this were allowable, the original invoice would have to be adjusted anyway as it would have included VAT on the materials that the supplier was passing on from his purchase and once registered he could recover that and only charge the customer the low rate ( assuming the 2/3rds rule was met) that would result in a revised invoice which would not be as high as just adding VAT onto it all. However that is moot since the OP has no obligation whatsoever to pay anything more. ( and that would be the general law in either ROI or the UK as regards VAT )
 
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