Merc van deposit contribution

[dfen5]

Might be me being a bit thick but..

Bought an Ex-demo Vito. Keep figures simple so say 10k + VAT = 12k

Agreed MB finance HP £10k, my deposit is the vat, 2k

£500 paid deposit by me at the dealer.

Now invoice arrives. £10k van + £2k vat - £500 I paid = £11500 outstanding.

MB finance £10k, me 1.5k

Now the dealers asks that I pay them £1k and the dealer then claims the MB deposit contribution of £500 contribution back from MB finance.

To me it looks like this means they are paying the deposit contribution off the vat which I would claim back in the next quarter anyway.. Should their 'deposit contribution' not be off the net cost of the van? For example, their deposit contribution reduces van to 9.5K + VAT?

[anonymous-user]

dfen5 said:

their deposit contribution reduces van to 9.5K + VAT?

That would be the correct thing to do, as that is what you are paying.

[TooLateForAName]

dfen5 said:

To me it looks like this means they are paying the deposit contribution off the vat which I would claim back in the next quarter anyway..

Are you saying that you think that you have only paid the VAT portion and are expecting to claim back that £2K on your next vat return?

[GoneAnon]

Looks OK to me. You have paid out £500 and have another £1000 to pay, but have an invoice for £2000 VAT.

You still recover your £2000 and the dealer gets the "missing" £500 from MB Finance.

If you can afford it,you could be better using the deposit contribution to reduce the size of the loan.
So you will have paid in your £2000 (that you get back from the VAT) and the extra £500 reduces the loan by £500.

[dfen5]

Sorted. Hadn't noticed the difference on the HP agreement