purchased breakfast bar

[Sondros123]

I'm really in a pickle. My business partner bought a burger bar/breakfast place without knowing how much the electricity costs for the business. We had many questions about expenses like waste collection and food bills, and when we asked about the electricity cost, Jeff told us it was £0.67 per hour and he paid the landlord £80 in cash each month. He said he kept track of everything per day and gave it to his accountant. About three months into the business, my friend asked me how much I paid for electricity, and I told him £0.67 per hour. He then told me that this was a very high rate. I later found out that the landlord had increased Jeff's electricity without his approval. When I called the electricity company to ask how much the landlord was paying, they couldn't tell me, which I understand. I did ask if £0.67 was very high, and they said it was. I also called Citizens Advice, and they told me that if someone wanted to buy the burger bar, I would have to explain the situation to them. The business is doing well in an industrial estate, but if I get a generator for electricity, the landlord will raise the rent. I asked the landlord if he was paying £0.67, and he said yes. I can't push it or it could turn bad. When I confronted Jeff, he told me that's what the landlord is paying. I find it hard to believe because the landlord would only be making £80.00 a month from the rent. I feel so foolish for accepting the £0.67 until I found out it was a lie. More people are coming all the time, but I feel trapped. Anyone purchasing the business would have to be told about this. I feel so depressed, down all the time, and cry when I'm alone. What can I do?

 

[wayzgoose]

Can't quite get my head round what you're trying to say - 67p per hour seems a bargain ! Do you use electricity or gas for cooking?

 

[Sondros123]

Can't quite get my head round what you're trying to say - 67p per hour seems a bargain ! Do you use electricity or gas for cooking?

That is electric for cooking,

 

[Sondros123]

That is electric for cooking,

thanks for replaying people tell me its expensive, the woman from the British gas said that it was excessive, my mate the electrician said it was expensive, a garage owner said his KWPH was a lot less than that even with a standing charge, now im confused

 

[WaveJumper]

You need to re look at this you surly mean you are being billed £0.67 Unit Price per kWh which sounds very high average could be around £0.25 plus of course you need to include the daily standing charge, which for a domestic property I have under Opus at the moment is £0.67 per day for a business the rate could be much higher.

What you need to look at is how many KW you are actually using a month then work backwards from there

 

[matlob]

do you mean 67pence per kwh rather than hour?

 

[WaveJumper]

I meant to add to my post is the landlord giving you an invoice, is he VAT registered as there's VAT on business energy

 

[Sondros123]

do you mean 67pence per kwh rather than hour?

£0.67 per kwh

 

[Sondros123]

£0.67 per kwh

thanks

 

[Sondros123]

I meant to add to my post is the landlord giving you an invoice, is he VAT registered as there's VAT on business energy

Im in a bit of a dilemma i feel it all would go pear-shaped if i would ask for an invoice, i was thinking about the VAT they would be VAT-registered,

 

[Sondros123]

I meant to add to my post is the landlord giving you an invoice, is he VAT registered as there's VAT on business energy

thanks

 

[Sondros123]

Im in a bit of a dilemma i feel it all would go pear-shaped if i would ask for an invoice, i was thinking about the VAT they would be VAT-registered,

You need to re look at this you surly mean you are being billed £0.67 Unit Price per kWh which sounds very high average could be around £0.25 plus of course you need to include the daily standing charge, which for a domestic property I have under Opus at the moment is £0.67 per day for a business the rate could be much higher.

What you need to look at is how many KW you are actually using a month then work backwards from there

i have a meter attached to the van, take a reading every day and log it, one month it was 620 from April to May 620 x £0.67 per unit price and he had £415.45, plus rent £80.00 for standing charge i have no clue.
If i would have known the cost of business electric i would not have purchased the place.
thanks

 

[matlob]

Is Jef the person who used to run the van?
He said it was 67p from what you have said.

Are you paying £80 per month to use the van on the site where you sell from?

 

[Newchodge]

thanks for replaying people tell me its expensive, the woman from the British gas said that it was excessive, my mate the electrician said it was expensive, a garage owner said his KWPH was a lot less than that even with a standing charge, now im confused

Do you mean 0.67 per hour or do you mean 0.67 per Kilo Watt hour? there is an enormous difference.

 

[ecommerce84]

67p per kWH is on the high side - it sounds like you and previously Jeff were paying a cheap rent and the landlord was marking up the electricity when charging you. My understanding is that this is legal.

Are you keeping your books up to date? You’ve been there for 3 months, once all revenue has been logged and all expenses too, have you made any money over those 3 months? Does that profit correlate to Jeff’s profit prior to you taking over? It is perfectly possible that despite the high electricity rate, this is being somewhat offset by the low rent and the business is profitable.

You are entitled to VAT invoices so please don’t be afraid to ask. If your landlord isn’t VAT registered you are still entitled to an invoice.

How exactly are you paying for your electricity? Is the landlord billing you each month?

You are doing the right thing by doing your own meter readings and calculating what you owe - put that money to one side so that you can pay it when the landlord asks.

 

[pentel]

Although you are paying a high electricity charge you also say that:

The business is doing well in an industrial estate,

Does this mean that you are making the profit levels you expect.

 

[Sondros123]

i have a meter attached to the van, take a reading every day and log it, one month it was 620 from April to May 620 x £0.67 per unit price and he had £415.45, plus rent £80.00 for standing charge i have no clue.
If i would have known the cost of business electric i would not have purchased the place.
thanks

Is Jef the person who used to run the van?
He said it was 67p from what you have said.

Are you paying £80 per month to use the van on the site where you sell from?

That is correct its not £0.67 per hour the unit is £0.67 which i believe to be high

 

[Sondros123]

Although you are paying a high electricity charge you also say that:



Does this mean that you are making the profit levels you expect.

Its not doing that bad, but to sell it if I wanted to i would have to be honest, also there is the VAT element it was rightly pointed out to me that there is supposed to be VAT added to an invoice, By right you/me anyone is obliged to tell HMRC, which makes it more problematic.

 

[Sondros123]

Is Jef the person who used to run the van?
He said it was 67p from what you have said.

Are you paying £80 per month to use the van on the site where you sell from?

it would have been better if they would have charged £240 rent and £0.25 per unit

 

[Paul Kelly ICHYB]

@Sondros123 How much diligence did you do before making this purchase?

If this is something you are unclear on, my fear would be what else have you missed and is going to bite you on the bum?

 

[tony84]

It sounds like the landlord is subsiding the rent with the elctricity income for some reason.

Can you not find a way to cut back on the electric costs? Batch cook, cook at home and heat up or alter the menu to be less cooked food - maybe you could do something like chilli and chips or shakshuka so you just have a slow cooker on.

I dont know, but it sounds like you have just bought a pitch and you are at the landlords whim. So even if you do find a way to cut the energy costs, youre rent will go up. I assume you cant just have the conversation where you renegotiate your deal?

Maybe just turn up and offer sandwiches so nobody else can take your spot and it forces the landlord to negotiate?

 

[ecommerce84]

Its not doing that bad, but to sell it if I wanted to i would have to be honest, also there is the VAT element it was rightly pointed out to me that there is supposed to be VAT added to an invoice, By right you/me anyone is obliged to tell HMRC, which makes it more problematic.

Do you know for sure that the landlord is VAT registered? They can only charge VAT if they are VAT registered.

Additionally, I think that commercial landlords can only charge VAT on rent (and possibly utilities) if they have ‘opted to tax’ the building so if your landlord hasn’t gone down this route then they may not be able to charge anyway. (DISCLAIMER - my VAT knowledge is good, but this particular aspect of it is something I’ve never had experience of, but I wanted to bring it up as it could be relevant. Hopefully a more knowledgeable member will be able to confirm or correct me).

 

[japancool]

I read the thread title and I thought it would be about someone wanting to know if they could claim their morning flapjack on expenses.

Its not doing that bad, but to sell it if I wanted to i would have to be honest, also there is the VAT element it was rightly pointed out to me that there is supposed to be VAT added to an invoice, By right you/me anyone is obliged to tell HMRC, which makes it more problematic.

Are you afraid that they will suddenly back-bill you for an extra amount of VAT?

 

[MyAccountantOnline]

I'm really in a pickle. My business partner bought a burger bar/breakfast place without knowing how much the electricity costs for the business. We had many questions about expenses like waste collection and food bills, and when we asked about the electricity cost, Jeff told us it was £0.67 per hour and he paid the landlord £80 in cash each month. He said he kept track of everything per day and gave it to his accountant. About three months into the business, my friend asked me how much I paid for electricity, and I told him £0.67 per hour. He then told me that this was a very high rate. I later found out that the landlord had increased Jeff's electricity without his approval. When I called the electricity company to ask how much the landlord was paying, they couldn't tell me, which I understand. I did ask if £0.67 was very high, and they said it was. I also called Citizens Advice, and they told me that if someone wanted to buy the burger bar, I would have to explain the situation to them. The business is doing well in an industrial estate, but if I get a generator for electricity, the landlord will raise the rent. I asked the landlord if he was paying £0.67, and he said yes. I can't push it or it could turn bad. When I confronted Jeff, he told me that's what the landlord is paying. I find it hard to believe because the landlord would only be making £80.00 a month from the rent. I feel so foolish for accepting the £0.67 until I found out it was a lie. More people are coming all the time, but I feel trapped. Anyone purchasing the business would have to be told about this. I feel so depressed, down all the time, and cry when I'm alone. What can I do?

I'm really sorry to read this. I had a little difficulty understanding the position.

Can I ask who is Jeff? You say ''Jeff told us'' as if he's a third party to yourself and business partner?

You say the business is doing well why are you considering selling?

 

[NickGrogan]

67p per unit (kWH) is high - at the moment.

But its sounds like the landlord had an existing contract, which he is rebelling you for. This means he will have agreed the contract in the past - possibly when rates where much higher.

There are companies that are paying £1 or more per unit, as they agreed contracts in 2022 when prices where at their peak. So this may be the rate that the landlord is actually paying.

Also you haven't mentioned standing charges - these can make up a large part of the bill. The landlord may be including these in the unit rates what he is charging you as well.

The only way to know for sure is to talk to the landlord.

 

[Gyumri]

I'm really in a pickle. My business partner bought a burger bar/breakfast place without knowing how much the electricity costs for the business.

What is the basis of your occupation in the unit? It is presumably some type of commercial short-term lease so you would need to read what it states about the payment of utilities and how the rates are determined.

67p is just over twice the EDF energy rate and they are more expensive even than Octopus.

At the end of the day you will have to decide whether it really is a pickle and if so move to somewhere else.

 

[japancool]

So Jeff told you it was £0.67 per unit,, and £0.67 is what you're paying.

I don't see what the problem is. Presumably, when you worked out your figures before buying the burger van, you worked it all out based on 0.67 per unit?

 

[Sondros123]

What is the basis of your occupation in the unit? It is presumably some type of commercial short-term lease so you would need to read what it states about the payment of utilities and how the rates are determined.

67p is just over twice the EDF energy rate and they are more expensive even than Octopus.

At the end of the day you will have to decide whether it really is a pickle and if so move to somewhere else.

Foolishly I have nothing and yes I was wrong, it is not as simple as moving to another location.

• The breakfast bar has a roof which covers the breakfast bar, a large table and two benches on either side and two benches outside with no protection from the rain, it is ideal when it rains or if it is too warm.
• If I removed the breakfast bar and let the cover and the benches it would be worth £8,000.00 max with the cover its worth £18,500.00 and the benches, the tables and benches are £2,000.00
• thanks for the reply

 

[Sondros123]

I'm really sorry to read this. I had a little difficulty understanding the position.

Can I ask who is Jeff? You say ''Jeff told us'' as if he's a third party to yourself and business partner?

You say the business is doing well why are you considering selling?

Jeff is the person i purchased the breakfast bar from, i don't want to sell but if I did I would be dishonest not to tell the truth

 

[Sondros123]

Do you know for sure that the landlord is VAT registered? They can only charge VAT if they are VAT registered.

Additionally, I think that commercial landlords can only charge VAT on rent (and possibly utilities) if they have ‘opted to tax’ the building so if your landlord hasn’t gone down this route then they may not be able to charge anyway. (DISCLAIMER - my VAT knowledge is good, but this particular aspect of it is something I’ve never had experience of, but I wanted to bring it up as it could be relevant. Hopefully a more knowledgeable member will be able to confirm or correct me).

yes they would be VAT registered, i know that has a fact thanks, cant remember but someone did say i should be invoiced with VAT

 

[Gyumri]

it seems you have nothing actually just to sell apart from the long table and benches.

You have no contract which gives you any rights of occupation so it looks like all you have is a personal licence from somebody to do something which is why it could go pear-shaped as you say at any moment. You could say that you are in a pear-shaped pickle if there are such things.

 

[Newchodge]

it seems you have nothing actually just to sell apart from the long table and benches.

You have no contract which gives you any rights of occupation so it looks like all you have is a personal licence from somebody to do something which is why it could go pear-shaped as you say at any moment. You could say that you are in a pear-shaped pickle if there are such things.

The unit is a van, not part of a permanent structure.

 

[Gyumri]

The unit is a van, not part of a permanent structure.

I see - well if the electricity is too high then it may be best to find another pitch for the van.

 

[WaveJumper]

Interested in the point @Gyumri mentioned do you have some form of lease / licence or any form of written agreement with the landlord, or is this just a handshake deal and you are paying in cash

 

[Sondros123]

it seems you have nothing actually just to sell apart from the long table and benches.

You have no contract which gives you any rights of occupation so it looks like all you have is a personal licence from somebody to do something which is why it could go pear-shaped as you say at any moment. You could say that you are in a pear-shaped pickle if there are such things.

These vans go second hand for £8,000.00 the whole place was purchase for £15,000 i cant understand the only thing we have is table and shares, oe do you like demeaning someone if you have nothing to help me dont bother replying

 

[wayzgoose]

Perhaps buy a generator?

 

[Sondros123]

The unit is a van, not part of a permanent structure.

The deal was for the structure, the benches and the van which is a permanent fixture, cant see why people are saying i have only tables and chairs to sell, why would i have spent £15,000.00 on chairs and tables.

 

[Sondros123]

Perhaps buy a generator?

1) I can't leave it on-site, and if i were able to lock it up in a steal cage so no one was able to take it that would be fine
.2) if i do that the landlord would raise the rent to make up for the shortfall in electricity.
thanks

 

[Sondros123]

The deal was for the structure, the benches and the van which is a permanent fixture, cant see why people are saying i have only tables and chairs to sell, why would i have spent £15,000.00 on chairs and

The deal was for the structure, the benches and the van which is a permanent fixture, cant see it has no hitch, it has no wheels, and its on blocks a burger van call it what you like

 

[Picture Bute]

These vans go second hand for £8,000.00 the whole place was purchase for £15,000 i cant understand the only thing we have is table and shares, oe do you like demeaning someone if you have nothing to help me dont bother replying

With the greatest of respect mate, you seem to have bought an item which you can't take anywhere, you don't know the difference between an hour and a KW/h and you are at the mercy of someone else who can kill your business. What kind of answers were you expecting ?