VAT on concrete pump

[RichS]

I have a concrete pump ordered for this week and the company I am using says it is VATable at the standard rate.

I know this is wrong and should be zero rated but what bit of the VAT rules should I quote to make them realise this.

Thanks

[PeterW]

That’s the correct rate - sorry !!! It’s not reclaimable either...

 

The only way to get a pump zero rated is have the concrete company do supply and fix and zero rate the whole job. 

[newhome]

You can’t reclaim the vat or have it zero rated at source on any hire equipment other than if, as @PeterW says, the company that supplies and fits something supplies and uses equipment to do so. 

[Vijay]

That's not true Peter, the last lot of concrete I got for my ICF walls was a seperate company to the pump company. The pump company was zero rated.

 

I'm sure it's because you're not hiring the equipment, your getting the equipment with operator

Edited August 12, 2018 by Vijay

[newhome]

Just now, Vijay said:

That's not true Peter, the last lot of concrete I got for my ICF walls was a seperate company to the pump company. The pump company was zero rated.

 

It just means you got away with it though .... 

[Vijay]

6 minutes ago, newhome said:

 

It just means you got away with it though .... 

I don't think I did, it's like paying for any trade who use their own tools. You pay for the pump company and there tool is their pumps. 

 

Have a read in this post where I asked https://forum.buildhub.org.uk/topic/2646-zero-rated-vat/?tab=comments#comment-40685 

 

 

3.4.2 Goods on hire

Goods hired on their own are always standard-rated. Examples include the hire of:

• plant and machinery (although plant hired with an operator can be zero-rated where all the conditions in sub-paragraph 3.1.2 are met)

Edited August 12, 2018 by Vijay

[newhome]

Just now, Vijay said:

I don't think I did, it's like paying for any trade who use their own tools. You pay for the pump company and there tool is their pumps. 

 

Depends if you were hiring the equipment to use or asking them to supply the labour and the pump was used as a consequence of that labour. 

 

We hired all sorts of equipment from the tool hire company but it was delivered on site for us or our trades to use hence we were unable to reclaim the vat. 

[PeterW]

19 minutes ago, Vijay said:

I don't think I did, it's like paying for any trade who use their own tools. You pay for the pump company and there tool is their pumps. 

 

Have a read in this post where I asked https://forum.buildhub.org.uk/topic/2646-zero-rated-vat/?tab=comments#comment-40685 

 

 

3.4.2 Goods on hire

  

Goods hired on their own are always standard-rated. Examples include the hire of:

• plant and machinery (although plant hired with an operator can be zero-rated where all the conditions in sub-paragraph 3.1.2 are met)

 

You’re mixing two different VAT documents up here - be careful ..! That quote is from the VAT guide for suppliers of services in the building trade. ( @Nickfromwales Take note of this....)

 

The quote requires as it says, all parts of 3.1.2 to be met, but to meet those you need to satisfy point 3, which is the relevant certificates. Section 18 lists both certificates, but they are not for domestic dwellings, but for residential purpose which relates to the building of care homes etc. There is no recognised certificate for zero rating in a domestic dwelling otherwise it would be listed. 

 

The full VAT 708 notice is here. 

 

Your supplier has incorrectly interpreted the rules and would be unable to produce the correct certificate - and could effectively request the VAT from you... 

[nod]

3 hours ago, RichS said:

I have a concrete pump ordered for this week and the company I am using says it is VATable at the standard rate.

I know this is wrong and should be zero rated but what bit of the VAT rules should I quote to make them realise this.

Thanks

Anything hired is vatable scaffold etc Bit of bummer with something as expensive as a concrete pump

[nod]

Tha vat rules on construction are a nightmare 

I’ve been vat registered for over thirty years and still have problems

We often do carehomes and sheltered accommodation 

some are 0 rated others are not

Sometime it relates to being self contained ie own or communal kitchen 

Somtimes it is down to the ownership of the building and sometimes it’s a reduced rate 

I think the rules are made up as they go along 

[Russell griffiths]

We had this situation last week and as my wife is an accountant she asked the senior VAT consultants in the office to clarify the situation. If the invoice is for the supply of concrete and the hire of a pump with an operator then the whole amount is VATable and you can reclaim the VAT on the material aspect (but not the pump hire). Although the pump hire with an operator seems like a sub-contractor, it is not considered to be so as the operator is not really doing a task as such, they are more a means of delivering the material i.e. the driver of the pump. If the pump operator poured the concrete, levelled it, smoothed it and troweled it to a finish, it would then be zero rated as they would be supplying a service but it would need to state this quite clearly on the invoice. 

[newhome]

1 minute ago, Russell griffiths said:

but it would need to state this quite clearly on the invoice. 

 

I imagine the best way round it would be to have the invoice raised as a zero rated labour invoice and not mention supply of any equipment. Will depend on what the company in question is prepared to do however. 

[Vijay]

Sorry guys, I don't get the logic. What's the difference from a ground works company turning up with a digger and a pump company turning up with a pump? Surely your paying the company to do a job, you're not hiring the machinery and doing the job yourself. Why would one be zero rated and the other not?

[Nickfromwales]

5 minutes ago, Vijay said:

Sorry guys, I don't get the logic. What's the difference from a ground works company turning up with a digger and a pump company turning up with a pump? Surely your paying the company to do a job, you're not hiring the machinery and doing the job yourself. Why would one be zero rated and the other not?

Because the VAT man says so. Simples. 

[Nickfromwales]

2 hours ago, PeterW said:

( @Nickfromwales Take note of this....)

?

53 minutes ago, nod said:

I’ve been vat registered for over thirty years and still have problems

I've been VAT registered for 30 days. 

??

 

This place continues to be a very diverse and invaluable source of information and support. 

[Russell griffiths]

There is no logic it is just the way you word it

 

At the end of the day you are probably talking about £60 so don’t sweat it and be thankful you can claim any of it. 

 

[Vijay]

I didn't push it with the pump company, I mentioned it and they said yeah no problem, we're already aware of it for self builders.

[newhome]

I think it’s one of those slightly grey areas where you may have some luck persuading the supply company to zero rate if you can argue that you are being supplied with labour via the operator and thus the equipment should also be zero rated. As to logic, it’s HMRC we are talking about!

 

I should likely have asked for the crane hire to be zero rated as it came with an operator to lift panels and trusses info position during the initial construction but too late now. 

[newhome]

So a bit more searching and I found this in HMRC’s internal manual:

 

https://www.gov.uk/hmrc-internal-manuals/vat-construction/vconst02740

 

This does imply that the pump can be zero rated as long as the operator is involved in the construction of the building. You will still need to persuade the company to zero rate however as you will not be able to reclaim vat incorrectly charged via the DIY reclaim scheme. 

[jack]

9 hours ago, newhome said:

I should likely have asked for the crane hire to be zero rated as it came with an operator to lift panels and trusses info position during the initial construction but too late now. 

 

We missed this one for the crane+operator we engaged to move our windows into place. Didn't realise until about two years later! 

[Temp]

 I believe it depends if the pump is simply part of the delivery of the concrete or if they are actually providing a service such as the filling of form work or leveling slabs as well...

 

Seperate delivery charges are normally standard rated, not reclaimable.

Services are zero rated, and materials provide as part of the service are also zero rated.