[Suffolkcleaners]

Ps I did read on there terms and conditions that if you are under the VAT threshold to contact them and send proof etc??? Can someone explain this? Seems like a hassle to me

[The Jester of Wibbly]

Just read this post. So this means for sole traders like myself (Who are well below the VAT threshold)let’s say a £25 house and they will take £5.00 VAT plus there fees is that correct? So will end up with less than £20. I’m going to need to move them back to BACS payments. How annoying!!

Dont think so.  They are just charging vat on the small fee they take.

It's your responsibility to add your own VAT to the transaction if you are registered.

[Suffolkcleaners]

Ahh that’s not as bad then. So if the fee is 60 pence on a small job say it will only be 20% of the  60 pence fee? So 12 pence extra. Is that right?

[The Jester of Wibbly]

Ahh that’s not as bad then. So if the fee is 60 pence on a small job say it will only be 20% of the  60 pence fee? So 12 pence extra. Is that right?

Yes, I copied and pasted from GC website of the new changes from September on this thread too.

[Suffolkcleaners]

Great thanks for that

[Tom-01]

How would a VAT registered company go about claiming back the VAT?

Because the VAT is taken off of the total before it’s paid out, so the company would receive the total amount minus the fees and VAT. So it wouldn’t show on turnover so how can they claim it back? Or am I missing something?

[Mike Burd]

How would a VAT registered company go about claiming back the VAT?

Because the VAT is taken off of the total before it’s paid out, so the company would receive the total amount minus the fees and VAT. So it wouldn’t show on turnover so how can they claim it back? Or am I missing something?

Just been speaking to Mrs about this. We offer GC as a payment option and maybe have 100 or so on it. We’ll contact Chris at Aworka as I reckon it’s there that this needs sorting. We now use Aworka for VAT submissions so hopefully it should be easy. 

[Tom-01]

Just read this post. So this means for sole traders like myself (Who are well below the VAT threshold)let’s say a £25 house and they will take £5.00 VAT plus there fees is that correct? So will end up with less than £20. I’m going to need to move them back to BACS payments. How annoying!!

Nope.
It would be £25:
- 1% = .25p
+ .20p = 45p
+ 20% = .54p

So a £25 job you will be left with £24.46

It’s not massive, but add it on to every transaction it builds up. Like soupy 1000 customers it’s a lot.

Perhaps make the money back elsewhere:
- Small increase in price, even .50p or £1
- Offer garage door cleaning at £3 each time
- If you do addons charge an extra £5 or £10 than you would normally

Can’t even take cash payments anymore because no-one except the kebab van takes cash these days! 

[Tom-01]

How would a VAT registered company go about claiming back the VAT?

Because the VAT is taken off of the total before it’s paid out, so the company would receive the total amount minus the fees and VAT. So it wouldn’t show on turnover so how can they claim it back? Or am I missing something?

Just been speaking to Mrs about this. We offer GC as a payment option and maybe have 100 or so on it. We’ll contact Chris at Aworka as I reckon it’s there that this needs sorting. We now use Aworka for VAT submissions so hopefully it should be easy. 

 However, VAT is paid based on turnover, so what hits your account.

Say you do £150k ‘worth of work’ all on GC, you won’t get £150k each year in your account to pay the VAT on - but you are paying VAT on your fees, which you can’t claim back - is that correct?

[Tom-01]

Ps I did read on there terms and conditions that if you are under the VAT threshold to contact them and send proof etc??? Can someone explain this? Seems like a hassle to me

Whereabouts is that please mate?

[Tom-01]

Just found it.

All you have to do is send the last years tax return showing you’re under the VAT limit and a copy of an invoice showing that no VAT has been charged.

Pretty straight forward.

[Mike Burd]

How would a VAT registered company go about claiming back the VAT?

Because the VAT is taken off of the total before it’s paid out, so the company would receive the total amount minus the fees and VAT. So it wouldn’t show on turnover so how can they claim it back? Or am I missing something?

Just been speaking to Mrs about this. We offer GC as a payment option and maybe have 100 or so on it. We’ll contact Chris at Aworka as I reckon it’s there that this needs sorting. We now use Aworka for VAT submissions so hopefully it should be easy. 

 However, VAT is paid based on turnover, so what hits your account.

Say you do £150k ‘worth of work’ all on GC, you won’t get £150k each year in your account to pay the VAT on - but you are paying VAT on your fees, which you can’t claim back - is that correct?

Lost me. 

[Richard iSparkle]

https://www.smartdebit.co.uk/

i've used these guys for about 5 years.

very easy to deal with

i charge my customers a monthly fee (for the 4 weekly service) so for instance £10 a coal would be £10.83 a month (clean price * 13/12)

they are charged on the same date a month

[simon w]

Can't understand why any window cleaner would want to use anything other than cash or bank transfer. Everything else just seems like a faff.

[Crystal-clear]

Okay so all this panic over 9 pence extra on a £25 Job  ?  But Fair to mention it so if you show them proof you're on the flat rate maybe they'll save us also a few pence or is it only if below 85k ..
I understand Penny's do add up and at some point the line needs to be drawn but not worth stressing I think it's more feasible just crack on and clean windows its just 9p on £25 :/

[Tom-01]

Okay so all this panic over 9 pence extra on a £25 Job  ?  But Fair to mention it so if you show them proof you're on the flat rate maybe they'll save us also a few pence or is it only if below 85k ..
I understand Penny's do add up and at some point the line needs to be drawn but not worth stressing I think it's more feasible just crack on and clean windows its just 9p on £25 :/

I agree, and there’s ways to recoup the cost.

The thing is GC started at just 1% of the transaction fee, so it was just .25p

Then they added .20p per transaction on top

Then now it’s +VAT

So what used to cost .25p now costs .54p - more than double the original cost, so I can see why some with lots of customers don’t want to pay the extra.

[Crystal-clear]

Okay so all this panic over 9 pence extra on a £25 Job  ?  But Fair to mention it so if you show them proof you're on the flat rate maybe they'll save us also a few pence or is it only if below 85k ..
I understand Penny's do add up and at some point the line needs to be drawn but not worth stressing I think it's more feasible just crack on and clean windows its just 9p on £25 :/

I agree, and there’s ways to recoup the cost.

The thing is GC started at just 1% of the transaction fee, so it was just .25p

Then they added .20p per transaction on top

Then now it’s +VAT

So what used to cost .25p now costs .54p - more than double the original cost, so I can see why some with lots of customers don’t want to pay the extra.

Absolutely and particularly if you're working alone it's basically about 55p it used to be very cheap unnoticeable and a lot cheaper than PayPal etc

All they've done now is they decided to plus VAT because they know a lot of people are VAT registered and theyll just pay it so technically won't be extra cost to some and will keep thier profits up.

Looks like they're not going to be charging people under the threshold though so shouldn't be a problem anyway.
Look has to be a line drawn somewhere and I don't know for me personally I would say probably about £1 on 25 quid then I probably wouldn't encourage it as a payment option as much 

[Soupy]

Can't understand why any window cleaner would want to use anything other than cash or bank transfer. Everything else just seems like a faff.

Cash is a faff.

[Richard iSparkle]

Can't understand why any window cleaner would want to use anything other than cash or bank transfer. Everything else just seems like a faff.

It come down to scalability.

If you are happy with your business how it works currently, your getting paid enough, have enough time, money is coming in in time, etc etc... no need to change.

But growing a business is best done by building systems that make you life easier and your business more efficient.

DDs are an amazing tool for building a scalable long term system in your business

[Suffolkcleaners]

Thanks guys and Tom for the breakdown. I’m fortunate as in I only have 40 odd GC customers however appreciate for people like soupy 1000 customers will certainly add up. Thanks again. Defo keep the GC customers who are/ were slow payers and maybe the ones who you know are prompt at paying get them to just BACS it over (in soupy’s case I mean) 👍