blipsblips
Registered User
- Messages
- 7
Just a question. I've frequented shops like Gamestop, CEX and others that offer a lower amount in cash and a higher amount in store credit for items brought in by the public. I was wondering, how is the whole store credit thing figured out in terms of tax, specifically VAT? Is VAT only charged on items that are purchased with money?
I give them x in exchange for store credit worth €50 (which they will go on to sell for €100) and I purchase y (which was acquired by the shop in exchange for €25 store credit with someone else) for €50 with my store credit. Because it is 2nd hand goods from individuals, could they operate the margin scheme? How would they be able to do that if they aren't really acquiring their stock from individuals with cash? I can't see how the credit note could act as cash from a tax perspective.
Again, if they buy x for €25 from me, I walk away, and then they sell x on for €100 to someone with money, they would then owe 23% of the €75 difference, which would be €17.25. They give me a credit note for X worth €50, and then sell it on for €100. Is their a cash value attributed to the credit note? Would every item in Gamestop have to be tracked or do they just not bother with it and pay the 23% from their turnover and leave it. Have I just confused myself?
It would be great if anyone could help/answer. Cheers.
I give them x in exchange for store credit worth €50 (which they will go on to sell for €100) and I purchase y (which was acquired by the shop in exchange for €25 store credit with someone else) for €50 with my store credit. Because it is 2nd hand goods from individuals, could they operate the margin scheme? How would they be able to do that if they aren't really acquiring their stock from individuals with cash? I can't see how the credit note could act as cash from a tax perspective.
Again, if they buy x for €25 from me, I walk away, and then they sell x on for €100 to someone with money, they would then owe 23% of the €75 difference, which would be €17.25. They give me a credit note for X worth €50, and then sell it on for €100. Is their a cash value attributed to the credit note? Would every item in Gamestop have to be tracked or do they just not bother with it and pay the 23% from their turnover and leave it. Have I just confused myself?
It would be great if anyone could help/answer. Cheers.