VAT : custom welded window frame supply only

[Tony C]

Hi, I am commissioning some custom fixed window frames made from Aluminum sections welded together.

Metal fabrication company will not be installing these window, they make these frames and deliver to the site only.

Is this should be zero rated as they are supplying some sort of service welding all together?

[joe90]

I guess if you can get them to word the VAT receipt to say they are window frames I don’t see why you cannot reclaim the VAT. Services don’t tend to be zero VAT.

Edited December 19, 2019 by joe90

[Ed Davies]

46 minutes ago, joe90 said:

Services don’t tend to be zero VAT.

 

Labour is zero VAT, though. Bit difficult when the labour is offsite: I think the point is that labour done on the house has to be for the particular house by its nature whereas materials supplied could, for all the supplier knows, be fitted to some other house so materials can only be zero VATed if the supplier bolts, glues or whatever the thing in place.

[Russell griffiths]

Nope I don’t think so, I have just had a big steel beam welded off site and then supply only,  vat was included and I will need to claim it back at the end. 

[Temp]

It depends what the invoice says..

 

Safest way is just to ask them for the invoice to say "Supply of windows" "or perhaps "Supply of windows to customer drawing" or something like that. Then they would count as "materials" and their invoice should include VAT which you reclaim like any other materials.

 

It gets complicated if they itemise everything and what the breakdown says..

 

If its got a "service" element such as "Design windows" I believe that can be argued either way because VAT 708 says in 3.4.1..

 

EDIT: Sorry one missing / and the formatting goes to pot and cannot be fixed. At least I cant figure out how to repair it. 

 

 

Quote

The supply of architectural, surveying, consultancy and supervisory services is

always standard-rated. 

But also..

 

Where it’s clear in the contract that any services of architects, surveyors or others acting as a consultant or in a supervisory capacity are no more than cost components of the contractors supply and are not specifically supplied on to the customer,

then the whole supply can be treated as being eligible for the zero rate.

 

My reading of this is that a design service that is primarily used by the window maker (eg to help them make the windows) it should be zero rated,. However if the design service was primarily provided to you (eg to get the shape and styling to suit your house) then it should be standard rated.

 

 

Edited December 19, 2019 by Temp

[Temp]

That last bit should read..

Quote

 

The supply of architectural, surveying, consultancy and supervisory services is always standard-rated. 
 

 

But also..

Quote

 

Where it’s clear in the contract that any services of architects, surveyors or others acting as a consultant or in a supervisory capacity are no more than cost components of the contractors supply and are not specifically supplied on to the customer, then the whole supply can be treated as being eligible for the zero rate.
 

 

 

My reading of this is that a design service that is primarily used by the window maker (eg to help them make the windows) it should be zero rated,. However if the design service was primarily provided to you (eg to get the shape and styling to suit your house) then it should be standard rated.

 

Edited December 19, 2019 by Temp

[HerbJ]

1 hour ago, Temp said:

My reading of this is that a design service that is primarily used by the window maker (eg to help them make the windows) it should be zero rated

I believe this is correct but ONLY if it is invoiced as part of the total package and not separately.

 

We had a staircase designed, manufactured and delivered. It was expensive, with a long design/manufacture schedule to suit our build and we reasonably agreed to stage payments. Unfortunately, Stage 2 Payment was invoiced as Design Service. it was only 10% of the total cost but HMRC rejected the invoice from our claim, because of the Invoice description.

 

So, include the design services within the total package cost and if you are agreeing Stage Payments, make them Stage 1, Stage 2 etc and do not be specific on the Invoices,that is Stage 2 ( or whatever)for Design Services.  The Stage Payment milestone achievement criteria can be described in a  a separate document ( for, example the contract...)

 

Edited December 19, 2019 by HerbJ
typos, etc

[nod]

3 hours ago, Temp said:

It depends what the invoice says..

 

Safest way is just to ask them for the invoice to say "Supply of windows" "or perhaps "Supply of windows to customer drawing" or something like that. Then they would count as "materials" and their invoice should include VAT which you reclaim like any other materials.

 

It gets complicated if they itemise everything and what the breakdown says..

 

If its got a "service" element such as "Design windows" I believe that can be argued either way because VAT 708 says in 3.4.1..

 

EDIT: Sorry one missing / and the formatting goes to pot and cannot be fixed. At least I cant figure out how to repair it. 

 

 

 

I’m totally with Temp here 

Splitting invoices can muddy the waters 

Safest is to get an invoice and claim it at the end 

 

[Tony C]

Thanks for all the useful info!

The design is done by architect, so the metal fabrication company will be just manufacturing the frame.

If the custom made staircase is standard rate and VAT reclaimable then, it is very similar to this custom designed window frames.

I will make sure the wording is correct on the invoice. "Supply only" is the key (!) it seems.

[joe90]

6 minutes ago, Tony C said:

Thanks for all the useful info!

The design is done by architect, so the metal fabrication company will be just manufacturing the frame.

If the custom made staircase is standard rate and VAT reclaimable then, it is very similar to this custom designed window frames.

I will make sure the wording is correct on the invoice. "Supply only" is the key (!) it seems.

 

?