Dealer taking me to court for VAT he has not paid.
Discussion
Myself , and brother (who is mental handicapped) went to a motorhome dealer in early 2006 to view and possibly trade in our 1999 Hymer A class. As we were looking at the newer motor homes, the salesman suggested we look at the brand new ones. As my brother is mentally handicapped and we use the van for him, he said that we would be eligible for a brand new van, Vat except (we new nothing about Vat except motor homes) so we decided that a new would work for us.
List price on the new van was approximately £29,000 inc vat and the salesman only wanted £500 to change, provided we were in receipt of full disability living allowance and were blue badge holders, we qualified on all 2 We handed in the paperwork and the van was delivered vat free.
The vehicle was delivered to us with no adaptions what so ever. I had to get these fitted after I took delivery by another dealer.(motorhomes have to be delivered with adaption to qualify for VAT excempt)
In 2008 the dealer has had a vat inspection for 2006, and motor homes which they have sold should not have been vat except and HMRC have asked the dealer to pay the Vat on the motor homes. (over 50 in total)
When we went to the dealer in 2006, we had no intention of buying a new motor home but the deal we were offered seemed a great deal. I entered into this contract in good faith understanding that the dealer knew what they were doing, so we were falsely advised,
The dealer is now taking us to the small claims court for approx £4600, this has been going on for a few months, buy Friday we recived a letter from the dealers solicitor saying that if we do not settle out of court then the cost would be an extra £4,000 for us to pay if we lose (costs)
The dealer has asked me to sign a VAT declaration which i know to be a lie which he says could make the matter go away and save me a possible £9000.
I am not going to sign the declaration as i am sure that would be VAT fraud.
If this goes to a small claims court and i lose, i cant afford to pay what can i do, I have a 9 month old baby and i am not working, my boyfried works but this matter has nothing to do with him but we do live together.
List price on the new van was approximately £29,000 inc vat and the salesman only wanted £500 to change, provided we were in receipt of full disability living allowance and were blue badge holders, we qualified on all 2 We handed in the paperwork and the van was delivered vat free.
The vehicle was delivered to us with no adaptions what so ever. I had to get these fitted after I took delivery by another dealer.(motorhomes have to be delivered with adaption to qualify for VAT excempt)
In 2008 the dealer has had a vat inspection for 2006, and motor homes which they have sold should not have been vat except and HMRC have asked the dealer to pay the Vat on the motor homes. (over 50 in total)
When we went to the dealer in 2006, we had no intention of buying a new motor home but the deal we were offered seemed a great deal. I entered into this contract in good faith understanding that the dealer knew what they were doing, so we were falsely advised,
The dealer is now taking us to the small claims court for approx £4600, this has been going on for a few months, buy Friday we recived a letter from the dealers solicitor saying that if we do not settle out of court then the cost would be an extra £4,000 for us to pay if we lose (costs)
The dealer has asked me to sign a VAT declaration which i know to be a lie which he says could make the matter go away and save me a possible £9000.
I am not going to sign the declaration as i am sure that would be VAT fraud.
If this goes to a small claims court and i lose, i cant afford to pay what can i do, I have a 9 month old baby and i am not working, my boyfried works but this matter has nothing to do with him but we do live together.
Somebody more qualifed than me will probably be along shortly, but as far as i'm aware the whole small claims process is desgined to be simple and cheap to administer, and only certain costs can be claimed, certianly not £4000+ in legal fees.
I'd keep hold of all letters sent/recieved and also pay a visit to the cab
I'd keep hold of all letters sent/recieved and also pay a visit to the cab
jamesuk28 said:
Any claim under £5000 is usually dealt with by the small claims track. Legal costs usually cannot be claimed assuming that the loosing party has adhered to the pre action protocols of the civil procedure rules. Therefore I would suggest the Claimants Solicitors are talking b0llocks.
Agreed....What do you have in the way of documentation confirming the deal?
I am no VAT expert andhave no idea if a seller can hunt youdown for VAT after you have paid your invoice, which you effectively have.
But I do know about VAT relief for disabled people. Basically this is VAT relief for any items NEEDED by that particular disabled person. For example, if a disabled person bought a wheelchair for their own personal use then they would sign a VAT exemption certificate that will be something like this;
"I declare that I am chronically sick or have a disabling condition and that I am receiving from XXXX XXXXX Health Care Ltd the following goods which are being supplied to me for the order I have placed for domestic or my personal use OR the products are being purchased on behalf of an individual who is chronically sick or disabled and the goods will be delivered to the individuals address. I claim that the supply of these goods is eligible for relief from Value Added Tax (VAT) under the VAT act 1994."
If, for example a shopping centre or hotel bought a wheelchair then they would have to pay the VAT on it.
I see no way why a motorhome is an invaluable aid for a disabled person so the VAT should not have been taken off.
Surely it is up to the retailer to invoice you for the VAT which will be included in the full price you have paid, and once you have paid the retailer the VAT liability becomes his problem.
As said above, ring the VAT office and find out where you stand and then inform them of this vile bully. If he does not have a leg to stand on, then the whole British public would like you to report the solicitors, that sent this bullying and intimidating letter, to their governing body.
Good luck and I would not even have a bet at 100/1 that you have to pay a penny more.
But I do know about VAT relief for disabled people. Basically this is VAT relief for any items NEEDED by that particular disabled person. For example, if a disabled person bought a wheelchair for their own personal use then they would sign a VAT exemption certificate that will be something like this;
"I declare that I am chronically sick or have a disabling condition and that I am receiving from XXXX XXXXX Health Care Ltd the following goods which are being supplied to me for the order I have placed for domestic or my personal use OR the products are being purchased on behalf of an individual who is chronically sick or disabled and the goods will be delivered to the individuals address. I claim that the supply of these goods is eligible for relief from Value Added Tax (VAT) under the VAT act 1994."
If, for example a shopping centre or hotel bought a wheelchair then they would have to pay the VAT on it.
I see no way why a motorhome is an invaluable aid for a disabled person so the VAT should not have been taken off.
Surely it is up to the retailer to invoice you for the VAT which will be included in the full price you have paid, and once you have paid the retailer the VAT liability becomes his problem.
As said above, ring the VAT office and find out where you stand and then inform them of this vile bully. If he does not have a leg to stand on, then the whole British public would like you to report the solicitors, that sent this bullying and intimidating letter, to their governing body.
Good luck and I would not even have a bet at 100/1 that you have to pay a penny more.
dazco said:
I am no VAT expert andhave no idea if a seller can hunt youdown for VAT after you have paid your invoice, which you effectively have.
But I do know about VAT relief for disabled people. Basically this is VAT relief for any items NEEDED by that particular disabled person. For example, if a disabled person bought a wheelchair for their own personal use then they would sign a VAT exemption certificate that will be something like this;
"I declare that I am chronically sick or have a disabling condition and that I am receiving from XXXX XXXXX Health Care Ltd the following goods which are being supplied to me for the order I have placed for domestic or my personal use OR the products are being purchased on behalf of an individual who is chronically sick or disabled and the goods will be delivered to the individuals address. I claim that the supply of these goods is eligible for relief from Value Added Tax (VAT) under the VAT act 1994."
If, for example a shopping centre or hotel bought a wheelchair then they would have to pay the VAT on it.
I see no way why a motorhome is an invaluable aid for a disabled person so the VAT should not have been taken off.
But I do know about VAT relief for disabled people. Basically this is VAT relief for any items NEEDED by that particular disabled person. For example, if a disabled person bought a wheelchair for their own personal use then they would sign a VAT exemption certificate that will be something like this;
"I declare that I am chronically sick or have a disabling condition and that I am receiving from XXXX XXXXX Health Care Ltd the following goods which are being supplied to me for the order I have placed for domestic or my personal use OR the products are being purchased on behalf of an individual who is chronically sick or disabled and the goods will be delivered to the individuals address. I claim that the supply of these goods is eligible for relief from Value Added Tax (VAT) under the VAT act 1994."
If, for example a shopping centre or hotel bought a wheelchair then they would have to pay the VAT on it.
I see no way why a motorhome is an invaluable aid for a disabled person so the VAT should not have been taken off.
It looks like adapted motorhomes can qualify for vat emeption, from a quick google. As to the OP's problem, I'd like to think that the trader is just trying it on, but I have no real idea as to whether he'd get away with it.
Thanks for all your replys,
Yes i have kept all invoices.
We did not go there looking for a motorhome with VAT relif it was put to us by the saleaman,As we are blue badge holders and my brother gets full DLA (disability living allowance).
As you can see the whole situation is really stressing me out hence i am reading all the replys at 5am.
I i do lose, i dont have the money to pay what can i do?
Yes i have kept all invoices.
We did not go there looking for a motorhome with VAT relif it was put to us by the saleaman,As we are blue badge holders and my brother gets full DLA (disability living allowance).
As you can see the whole situation is really stressing me out hence i am reading all the replys at 5am.
I i do lose, i dont have the money to pay what can i do?
A pound to a pinch of s
t the dealer has been caught out in a bigger VAT scam by the tax man, and is trying it on with anyone he can to get some cash to buy the bloodsuckers off. My OH has MS and we have bought VAT exempt goods and services. The OP meets all the requirements for VAT exempt supply, details here
Tell the dealer you've confirmed with the VAT man that you're not due any VAT, and he can go poke himself.
t the dealer has been caught out in a bigger VAT scam by the tax man, and is trying it on with anyone he can to get some cash to buy the bloodsuckers off. My OH has MS and we have bought VAT exempt goods and services. The OP meets all the requirements for VAT exempt supply, details hereTell the dealer you've confirmed with the VAT man that you're not due any VAT, and he can go poke himself.
rinker said:
We did not go there looking for a motorhome with VAT relif it was put to us by the saleaman,As we are blue badge holders and my brother gets full DLA (disability living allowance).
The VAT exemption on vehicles is for wheelchair users (or those who normally use a wheelchair) AND the vehicle is adapted so they can use the vehicle, such as hand controls for the driver, a loading system for a wheelchair. IIRC The adaption has to be "substantial" and permanent. It does not simply apply to Blue Badge holders or those in receipt of DLA.
http://customs.hmrc.gov.uk/channelsPortalWebApp/do...
I have seen a fair few motorhome dealer adverts with "Disabled? We can help you get this motorhome VAT free" so they're all at it, so it would seem.
Edited by J500ANT on Monday 9th November 08:36
Big_Dog said:
I think you will find that the responsibility for his VAT is entirely his. Just call your local VAT office. Contrary to popular belief they are really helpful.
I agree with this.My understanding has always been that in a case where VAT has (incorrectly) not been added to a sales invoice - they will treat it as thought invoice total is VAT inclusive.
For example - if an item should have been charged at £100 + VAT - but only £100 was charged, this will be treated as though the net price was £86.96 + VAT = £100, with the seller having to account for £13.04 in VAT.
You are not VAT registered (I assume) it is not your job to collect and administer VAT for an on behalf of HRMC.
My defense would be that I had no idea about VAT etc, it never comes into the equation as I can't recover VAT all I am interested in is the price and in this case it was the camper van + £500.
Sounds like his misinterpretation of the VAT exemption rules allowed him to sell many more motor homes than he would otherwise have done. It's as if he did it a few times, no-one asked any questions and so he continued. It's now caught up with him and he's in the st!
I think you should see these people for proper advice http://www.citizensadvice.org.uk/
Doesn't sound like he's got much of a claim: he misinterpreted the rules to sell you something you wouldn't otherwise have bought, you supplied all the info he told you was required for the discount to apply, he's got it wrong and is trying to scare you into covering his mistake. The VAT people aren't after you, they're after him.
Oh, and if you think you're worrying about this - how do you think he's feeling right now? No VAT on 50 vehicles in 2006? It's a lot of cash. And then assume that they haven't caught up with him over another 50 in 2007, 2008, 2009. Could be as many as 200 vehicles, at about £5k on each? And the VAT man NEVER stops chasing what he's owed.
t!rinker said:
The dealer is now taking us to the small claims court for approx £4600, this has been going on for a few months, buy Friday we recived a letter from the dealers solicitor saying that if we do not settle out of court then the cost would be an extra £4,000 for us to pay if we lose (costs)
Not in small claims. This bullying from a solicitor is bad form. Be sure to bring that letter to court! http://www.aboutsmallclaims.co.uk/who-pays-costs-c...rinker said:
The dealer has asked me to sign a VAT declaration which i know to be a lie which he says could make the matter go away and save me a possible £9000.
Don't do that! That has the ability to make the situation much worse.I think you should see these people for proper advice http://www.citizensadvice.org.uk/
Doesn't sound like he's got much of a claim: he misinterpreted the rules to sell you something you wouldn't otherwise have bought, you supplied all the info he told you was required for the discount to apply, he's got it wrong and is trying to scare you into covering his mistake. The VAT people aren't after you, they're after him.
Oh, and if you think you're worrying about this - how do you think he's feeling right now? No VAT on 50 vehicles in 2006? It's a lot of cash. And then assume that they haven't caught up with him over another 50 in 2007, 2008, 2009. Could be as many as 200 vehicles, at about £5k on each? And the VAT man NEVER stops chasing what he's owed.
I think you need to do a couple of things:
1. Do not sign anything they ask you to.
2. Go to court. You bought the vehicle in good faith. You are not responsible for the dealer messing up their VAT returns - they are.
3. You will not lose. They are threatening court to frighten you into paying.
They are in deep trouble for many thousands of pounds and the more people they can intimidate into paying means less they have to fork out.
The dealer has made a mistake - a bad one. They should be suing their accountant for bad advice, not their customers. Smacks of desperate measures by a sinking firm.
1. Do not sign anything they ask you to.
2. Go to court. You bought the vehicle in good faith. You are not responsible for the dealer messing up their VAT returns - they are.
3. You will not lose. They are threatening court to frighten you into paying.
They are in deep trouble for many thousands of pounds and the more people they can intimidate into paying means less they have to fork out.
The dealer has made a mistake - a bad one. They should be suing their accountant for bad advice, not their customers. Smacks of desperate measures by a sinking firm.
The Dealer has had the sts put up him by the VAT man so is panicing and trying to get othehr people involved to pay the money he owns, IF you had a problem with the VAT man they would let you know, possibly at 3AM with a knock through the door. Assuming what you have said is true he has fouled up, but get some advice from a lawyer so you have a letter or something to wave back at him as you tell him to do one.
ts put up him by the VAT man so is panicing and trying to get othehr people involved to pay the money he owns, IF you had a problem with the VAT man they would let you know, possibly at 3AM with a knock through the door. Assuming what you have said is true he has fouled up, but get some advice from a lawyer so you have a letter or something to wave back at him as you tell him to do one.Gassing Station | Business | Top of Page | What's New | My Stuff