Royal Mail & VAT

[RG at GT]

Can anybody tell me if Royal Mail charge me VAT? I use their Drop & Go service and send parcels internationally every day. I know they don't charge me VAT on UK postage but I'm unsure whether them as a company charge me for international postage. If they do how is it so impossible to get any form of record from them for this VAT so I can claim it back?
My head is hurting

 

[Argentum Tax]

Can anybody tell me if Royal Mail charge me VAT?

RG:See information on the link below. It should answer your question.
https://www.royalmail.com/information-vat-and-postal-services

 

[RG at GT]

Thanks. Yes that's what I've read so they do charge me VAT. As they don't provide any records or receipts for this VAT how would one go about claiming this VAT back? Every other business provides VAT receipts or invoices showing VAT but they provide nothing. I tried calling them only to be sent around in circles on automated systems not giving me the options I need to ask how to get these receipts.
It's very frustrating. How can I or my accountant claim this VAT back?

 

[Argentum Tax]

I suspect you can claim it back just on the strength of a normal Post Office receipt, rather than needing a full VAT receipt, but I may stand corrected by others here who know more than I do about VAT.

 

[RG at GT]

I suspect you can claim it back just on the strength of a normal Post Office receipt, rather than needing a full VAT receipt, but I may stand corrected by others here who know more than I do about VAT.

You would think that was possible but the receipts don't show VAT and it actually says on the bottm. Not a VAT receipt ;(

 

[Argentum Tax]

You would think that was possible but the receipts don't show VAT and it actually says on the bottm. Not a VAT receipt ;(

But I am saying, claim back the correct amount of VAT anyway. I don't think HMRC would challenge the claim for reasonable amounts. Just keep the receipts.

 

[RG at GT]

But I am saying, claim back the correct amount of VAT anyway. I don't think HMRC would challenge the claim for reasonable amounts. Just keep the receipts.

Thanks for this input. So what you are saying is go through every entry on the itemised receipt every day and calculate what the VAT is for each international package? I could do that but it would be a bit of a pain. I am willing to do it as I think I've lost out of many thousands of pounds VAT so far.

 

[Argentum Tax]

So what you are saying is go through every entry on the itemised receipt every day and calculate what the VAT is for each international package?

Well if you have a receipt for say 5 International Packages, all sent at the same time and on the same receipt, just calculate the VAT on the total amount. If you use book-keeping software it should do it for you. If its a mixture of VATable and exempt items just add up the VATable items and calculate the VAT on that total. It shouldn't take long.

 

[RG at GT]

Thanks ever so much sir. I think I'll do it the old fashioned way and input them individually just for clarity. The joys of building your own invoicing system hey? That's me busy for a day or 2

 

[LPB 123]

Thanks. Yes that's what I've read so they do charge me VAT. As they don't provide any records or receipts for this VAT how would one go about claiming this VAT back? Every other business provides VAT receipts or invoices showing VAT but they provide nothing. I tried calling them only to be sent around in circles on automated systems not giving me the options I need to ask how to get these receipts.
It's very frustrating. How can I or my accountant claim this VAT back?

Are you sure you're being charged VAT on your international items with Royal Mail, as a lot are exempt?

International economy, standard, signed, tracked & signed are all exempt including on account.

Whereas International tracked would be 20% (only to the EU), zero rated outside the EU.

You need to know what service you're using to see if you're actually being charged VAT or not. If you're concerned about inputting invoices every day then sign up to OBA for roughly 1 monthly invoice depending on your credit agreement with them. You will then also be able to use Royal Mail 24 & 48 in the UK rather than 1st and 2nd class which you can claim the VAT back on.

 

[RG at GT]

Are you sure you're being charged VAT on your international items with Royal Mail, as a lot are exempt?

International economy, standard, signed, tracked & signed are all exempt including on account.

Whereas International tracked would be 20% (only to the EU), zero rated outside the EU.

You need to know what service you're using to see if you're actually being charged VAT or not. If you're concerned about inputting invoices every day then sign up to OBA for roughly 1 monthly invoice depending on your credit agreement with them. You will then also be able to use Royal Mail 24 & 48 in the UK rather than 1st and 2nd class which you can claim the VAT back on.

To be honest I was being daft and getting in a muddle where Royal mail offer a service called "International Business Tracked and Signed" which they charge VAT on and the postage "International Tracked and Signed" which is 0% VAT. I went around the houses when it was staring me in the face lol.

 

[Spur Support Services]

They raise periodic VAT invoices.
Have a look at the support for e-Invoicing Help to arrange for the invoices to be mailed to you automatically and also visible online..

 

[RG at GT]

They raise periodic VAT invoices.
Have a look at the support for e-Invoicing Help to arrange for the invoices to be mailed to you automatically and also visible online..

I've established that using International Tracked & Signed is 0% VAT. Thanks though.

 

[Spur Support Services]

I've established that using International Tracked & Signed is 0% VAT. Thanks though.

If you are commercially sending UK packages through your Click and Drop account, then I do suggest you sign up to get the VAT invoices.
Only limited postal services are VAT exempt, with the intention of limiting exempt services to non-business products. All your Royal Mail business account UK deliveries are likely to include VAT.
You could well be missing out on VAT recoveries on your UK delivery charges, without accessing and retaining the invoices.

 

[RG at GT]

If you are commercially sending UK packages through your Click and Drop account, then I do suggest you sign up to get the VAT invoices.
Only limited postal services are VAT exempt, with the intention of limiting exempt services to non-business products. All your Royal Mail business account UK deliveries are likely to include VAT.
You could well be missing out on VAT recoveries on your UK delivery charges, without accessing and retaining the invoices.

I use Drop & Go. I'm already inputing numbers into my system in case the information is wrong but I can't find out anywhere if I'm being charged VAT. THe Royal Mail site says International Tracked & Signed is 0% VAT but finding out if I'm being charged VAT on the Drop & Go account is impossible.

 

[Spur Support Services]

I use Drop & Go. I'm already inputing numbers into my system in case the information is wrong but I can't find out anywhere if I'm being charged VAT. THe Royal Mail site says International Tracked & Signed is 0% VAT but finding out if I'm being charged VAT on the Drop & Go account is impossible.

Sign up for the eInvoicing (find through online help when you are signed into your Royal Mail account). That will give you the visibility you need.
https://business.help.royalmail.com/app/answers/detail/a_id/655

 

[LPB 123]

I use Drop & Go. I'm already inputing numbers into my system in case the information is wrong but I can't find out anywhere if I'm being charged VAT. THe Royal Mail site says International Tracked & Signed is 0% VAT but finding out if I'm being charged VAT on the Drop & Go account is impossible.

"International tracked and signed" is a VAT exempt service, whether you're buying this in the post ofiice, using "Drop and Go" or using "Click and Drop" with an OBA account.

I do agree with @Spur Support Services although I'd go for Click and Drop with an OBA account. Ebay, Amazon, Shopify etc can all be linked so everything is automated. 1 daily manifest/OBA order summary so you can see what you're paying per day and the VAT codes etc. Then 1 monthly invoice.

Also as stated earlier you'll have access to Royal Mail 24 / 48 instead of 1st and 2nd class for UK deliveries. Royal Mail 24 / 48 are 20% VAT rated so you will save money on your UK deliveries. You get further discount if you send 20 + parcels per day too.

 

[chickenlady]

I use Click & Drop. I have a Royal Mail Online Business Account. I get VAT invoices through the eInvoicing portal. It is much easier admin than just having the Click & Drop. But you can't just drop it in the post box.

 

[camelback890]

Can anybody tell me if Royal Mail charge me VAT? I use their Drop & Go service and send parcels internationally every day. I know they don't charge me VAT on UK postage but I'm unsure whether them as a company charge me for international postage. If they do how is it so impossible to get any form of record from them for this VAT so I can claim it back?
My head is hurting

Drop & Go is a retail, over-the-counter service, which is why getting clean VAT data out of them is challenging.

If you want to fix this permanently, move to a Royal Mail Online Business Account (OBA), which generates official monthly electronic invoices that clearly break down your standard, exempt, and zero-rated VAT lines.

Manually tracking these carrier lines is only going to get more painful as you grow. Most high-volume international shippers eventually move away from manual entry and use a multi-carrier shipping solution like TrueCommerce to automate the fulfillment, manifest, and invoicing data flow.

 

[Karimbo]

yes they do. tracked parcel services are vatable. letters are not, and royal mail have persuaded the thin line in a really weird way to hmrc.

royal mail large latter first class is £3.20 (non-vat)
royal mail large letter tracked 24 £3.80 (vatted).

The tracked 24 (better service) worked out cheaper for vat registered businesses, I think it's £3.10 or £3.05 plus VAT.

I'm vat registered but on flat rate scheme so it doesn't really benefit me. But if I was on the standard scheme then tracked 24 is a no brainer. far superior service and cheaper.