Contents
All change for pensions
A waste of time & money
Tax credit mess
Fuel up (shock)
Gimme shelter
Gulp! SIPPS
Paper or plastic?
Re: Mortgages
Bank the cheque
Subs beware
VAT's the limit
Dividend end?
The buck stops
Sack with care
Selling up
A matter of trust
We're watching
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In an American supermarket, they even offer you a choice of carrier bag. In a British shop, this question would probably mean payment by cash or credit card. If you have paid by plastic in any one of a large number of high street chains in the last few years, you may have noticed some peculiar words on the slip you sign - along the lines of "2.5% of the total amount is a charge for handling your credit card, but the total amount you pay does not change". This is a VAT-saving scheme. The idea is that charges for arranging finance are exempt from VAT. If the shop charges you £100 for some clothes, Customs get VAT on £100; if it's £97.50 for clothes and £2.50 for credit card handling, the VAT is less, and the shop gets to keep a little more on every sale. It makes no difference to the shopper, who still pays £100. Customs - not surprisingly - don't believe it. They think it's unrealistic to suppose that shoppers are really buying financial services when they take their goods to the checkout. They don't like the fact that there is no change in the total price - that the shop will give you a discount on the goods because it is able to charge you for a separate finance deal. Customs have recently won a battle with Debenhams in the Court of Appeal. The judges agreed with Customs: the plan didn't work. But they said their decision only applied to what Debenhams were doing when the argument started, a few years ago. The shop says it has changed its system since, and other shops claim that they always did it differently. So don't expect those words to disappear from your credit card slips in the near future. Customs, on the other hand, have been given a boost by the judges. They will carry on fighting, and they will hope to recoup a very large amount of money from all the shops when the argument finally finishes. This one will run and run!  |
© Bayar Hughes & Co., 2010.