Postage & VAT?

[Stitch Up]

If you purchase a 1st class stamp, is VAT included in the cost or is there no VAT?

Same question for sending packages via Parclefarce, Parcels2Go & other courier services?

Cheers

John

[purpledragon]

vats added on at source i think i know when i send through P4D i get the price and when i get to check out the vat gets added on there i presume the post office do the same.

[John G]

You cannot claim for the vat on a stamp but you have to charge for it when you charge postage. Parcels through a courier service is a total different kettle of fish - you can claim vat back on the cost

[logobear]

there is no vat on Royal mail stamps, if you are a reseller you buy and sell them zero rate.
If you charge extra for postage on goods sold you must charge collect vat on the total amount (inc postage) even thou you havn't paid vat on the stamps.
If you sell postage at cost price, you must still give the vat man his %age, - and hence will loose on the deal.

[bms]

there is no vat on Royal mail stamps, if you are a reseller you buy and sell them zero rate.
If you charge extra for postage on goods sold you must charge collect vat on the total amount (inc postage) even thou you havn't paid vat on the stamps.
If you sell postage at cost price, you must still give the vat man his %age, - and hence will loose on the deal.

It gets more complicated than this. Some of the basic postage rates from the PO are not vatable, but other services are.
If you are VAT registered and supplying VATable goods then you have to charge VAT on the postage, even if the PO rate is not vatable, e.g. a 1st class stamp.
If you are VAT registered and suppply NON-VATable goods (e.g. child clothing, edible inks) then this is zero rated and VAT isn't chargeable on the postage (or courier cost, even if the courier company charges it - you just reclaim the vat amount and don't charge).
And if you're supplying a mix of VATable/ NON-VATable then strictly speaking VAT is chargeable only on the VATable supply (but this gets complicated, so it may be easier just to charge VAT on the whole postage cost).
If you are not VAT registered, then you'll suffer VAT when it's charged but won't be able to claim it back.