VAT on fees

Hi,

Can anyone help. This is what my bookkeeper is saying about Google Checkout fees for our sales.

As regards the Google transaction fee, do they charge VAT ? Do they send you a summary of their charges at all ?

As far as I'm aware, they don't do they?




Strictly speaking, you cannot charge or reclaim the VAT unless you have a proper VAT invoice, ie one that shows the name, address and VAT number of the business.

Is this correct?

Hope you can help

Cheers :)
 

Jenni384

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  • Oct 1, 2007
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    Credit card processing fees such as Streamline are VAT Exempt. I would have thought Googld Checkout would be the same.
    I don't have any clients who use it so I've never seen an invoice to be sure.

    Yes, technically you need a proper VAT invoice to be able to reclaim any VAT. If you had a VAT Inspection and they found out that you were reclaiming VAT without a VAT invoice they would not be impressed ;)
     
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    Jenni384

    Free Member
  • Oct 1, 2007
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    It is interesting this one. As adwords is vatable, but the finance fees are exempt. The monthly processing fees aren't though. And they net off the addwords and the checkout fees and produce an vat invoice out of this!

    Sounds like a fun VAT invoice to split out and post :rolleyes:

    Aye, when in doubt, check what the invoice says!
     
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    3pic

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    Jun 20, 2007
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    I'm not up with the latest interweb McGuffins but as I understand it :-

    Adwords. Is advertising and Adwords is based in Ireland and so the place of suppy rules come into play. So if AdWords are given customers VAT Reg. No. they will not charge VAT and customer will accout for VAT in the UK. I'm not aware of any finance option as I thought Adwords was basically customer paid AdWords per no. of clicks.

    Google Checkout. I think there maybe two different supplies here. The first supply is customer makes purchase from suppliers website via google checkout. Google at this point process the credit card transaction and so that supply is an exempt one (ie, the supply of processing the credit card).

    The second supply is one of google checkout depositing money into suppliers accounts, less their fees. Their fees being a service (rather than of checking credit cards). I'll need to check, but I'm sure we'd need to determine if this action is as primary or as intermediary/agent status. Doubtful it is primary (that's the first stage in para. above) so it may be seen as ataxable supply on the basis that all google are doing is just passing money onto someone else and Google have acted as a third party/intermediary to which exemption may not apply.

    Anyway, it's late now so will ponder on it some more tomorrow.
     
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    Cheers - Google claim they don't send invoices.

    This is the response when emailing them.

    Thank you for your email.

    We greatly appreciate any feedback or suggestions for ways we can improve Google Checkout. Your comments provide us with the assistance we need to optimise our programme, so please continue to give us feedback in the future. Google Checkout does not provide any invoices for the Google Checkout transaction fee's, though this feature may be introduced at some point in the future. We will be taking your thoughts into account as we move forward with our product development.


    Aaargh!!!! :)

    Cheers
     
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    3pic

    Free Member
    Jun 20, 2007
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    Cheers - Google claim they don't send invoices.

    This is the response when emailing them.

    Thank you for your email.

    We greatly appreciate any feedback or suggestions for ways we can improve Google Checkout. Your comments provide us with the assistance we need to optimise our programme, so please continue to give us feedback in the future. Google Checkout does not provide any invoices for the Google Checkout transaction fee's, though this feature may be introduced at some point in the future. We will be taking your thoughts into account as we move forward with our product development.

    If they're not prepared to send an invoice then their suppply/transaction fee must be exempt. It is a requirement of VAT law (across the EU) to provide a VAT invoice where VAT has been charged, for whatever value, upon request by the customer so either google are breaking the law by refusing to supply a VAT invoice OR they've no need to provide a VAT invoice as there is no VAT being charged, so the transaction fee MUST be exempt - for whatever reason.
     
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    We have a response!!


    I understand that you would like to know if VAT is included in fees charged for orders processed through Google Checkout.

    Please be informed that we do not charge VAT on fees charged for processing your orders and we do not provide any invoice for transaction fees.

    Hmmmmm...interesting! :D
     
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    3pic

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    Jun 20, 2007
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    Thanks for the update.

    Clearly then, google checkout is acting as an intermediary between the cutomer who buys items off the web and the supplier who is selling them.

    Intermediary services are exempt, so sounds about right and as per my earlier emai, if no VAT is charged (because the service is an exempt one), then no legal requirement to provide an invoice.

    We've all learnt something this week then!.
     
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