VAT Invoices versus Entertainment Packages

Hello,

First post in a verrrrrrrry long time!

I've been with Plusnet for 14 years. I work from home so need VAT invoices, Plusnet have stopped providing VAT invoices with residential products. I can move to a (more expensive) business product and get VAT invoices though with no access to entertainment packages. It's kind of ridiculous.

Any thoughts, possible solutions?

Reckon I'm going to be looking for an alternative phone and broadband provider.

Regards.

BT do something similar, they assume VAT invoices are only relevant to businesses. Forgetting small businesses / sole traders are often VAT registered.

You could check with your accountant, but Plusnet are in the wrong from HMRC's perspective for not issuing as they are VAT registered. (as are British Telecommunications plc). So you could write the VAT number on the Plusnet invoice that you submit?

This has some info.

Interesting paragraph:

You must use VAT invoices if you and your customer are VAT registered.

OP : Is the line in the companies name or yours as an individual? If it is in the company name and the company is VAT registered then it appears they have to provide a VAT invoice. If it is in your name (and assuming you aren't VAT registered) then it would seem from the link that they don't have to provide a VAT invoice.

I was Vat registered, as a sole trader. Many others will be. However it does only cover a sole trader for items wholly or in part purchased for the business. Any non-business use has a myriad of regulations around it.

IMO Plusnet should still be providing a Vat invoice on request, but assuming the line and or broadband is used partially for broadband I suggest it is reasonable to require it to be on a business contract.

The exclusion of the entertainment package would seem unjustified, by the same logic. But separating out the Vat aspect of that may be complicated if it is bundled. It gets messy when I try to devise a way it could be added as a stand-alone in any way other than a separate non-VAT invoice.

Which raises the questions of both Plusnet's billing and order systems �. ROFL.

The law seems to be a bit complicated here. A comprehensive looking interpretation:
http://stewartaccounting.co.uk/wp-content/uploads/20...

Unless you're VAT registered you can't require a supplier to issue a VAT invoice.But PN apparently won't supply domestic services to businesses. This would seem to include a lot of sole traders working from home who may have no real reason to buy a business service.

If you take a nelsonian approach and simply calcualte the VAT element of each PN invoice you then have to hope that if you get a VAT inspection, the inspector agrees that the problem is de minimis.One feels that HMRC have got rather bigger concerns but it's hard to be certain.

Plusnet T&Cs specifically prohibit the use of residential packages for business purposes. So why would they provide a VAT invoice?

In reply to a post by TinyMongomery:

Plusnet T&Cs specifically prohibit the use of residential packages for business purposes. So why would they provide a VAT invoice?

Indeed:

2.1.3. use the services for personal use in the UK (so don't use the services to run your own business, but a couple of work emails or occasional home working are okay) and in accordance with our Acceptable Use Policy;

Ts&Cs are here

In reply to a post by TinyMongomery:

Plusnet T&Cs specifically prohibit the use of residential packages for business purposes. So why would they provide a VAT invoice?

Is a sole trader, not a separate legal entity, using a broadband connection in their home, to send/receive emails for personal and commercial reasons as well as for domestic entertainment - a "business" in plusnet's eyes?

Its the same game BT retail play, and I know it has lost them many customers.

Some accountants advise sole traders just to write the VAT number on the invoice when submitting accounts. Give the problem to the HMRC !

Edited by jchamier (Thu 20-Dec-18 09:34:02)

See the Ts&Cs I posted - yes a sole trader is a business and PlusNet Ts&Cs specifically exclude this usage from their consumer products.

Thanks for the replies all!

My perspective is that any VAT registered supplier should provide a VAT invoice upon request. Furthermore it costs no more to generate a PDF featuring VAT than it does one that doesn't feature VAT.

I also don't believe that PlusNet are correct in putting 'business use only' in their T&Cs, it's a restrictive trading practice, it's not their business what the customer uses the connection for (unless it's illegal) and a large proportion all BB customers will use their connection for business use and either their employer or they themselves maybe VAT registered.

However if the business products were competitively priced and well featured it would not be a problem. Though a business product offers no advantages over a residential product, it will cost me more extra than I can reclaim in VAT and does not feature the entertainment packages.

They either need to offer VAT invoices on residential products or entertainment packages on competitively priced business products.

There's also a loyalty issue here, I've been loyal for nearly 15 years, when I signed up they just did broadband and provided VAT invoices as required.