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should the park owners be paying 20%vat on domestic electricity?
I accept that the Park owners have a holiday business at the park and 20% is applicable to that, but should they be paying 20% for electricity used by resident domestic users?
obviously I am not asking the right questions.
I understand about deminimus supplies of power (vat notice 701/19)
What I need to know is, should the Park owner be paying 5% or 20% for our domestic power.
Everything I read including ofgem guidance says it should be 5%.
Can you confirm 5% or 20%
There are a number of other exceptions to the 20 per cent rate of VAT. These include:
- Where the majority of the energy is used in a domestic setting
- Where the business is a home, hospice, rehabilitation residence or place of care for children, addicts, members of the armed forces, students or the elderly
- Where the business is a nunnery, monastery or other religious building
- Where the business is a self-catering holiday accommodation, house boat, caravan or where it is a primary residence for over 90 per cent of the people living there
- Where at least 60 per cent of the energy used supplies a premises meeting these criteria
electricty is supplied to the park on one meter. All residents have their own separate meters recording usage at their own properties and are billed on the amount used, all less than 33kwh per day. The Park owner is then able to calculate his own usage. Can you confirm that I should only be paying 5% vat included in my unit rate. I accept that the park owner needs to recover his costs but his cost should surely be at the 5% vat charge.
Charles, thank you for your reply.Separate meters for residents are for internal charging purposes only.If the owner has paid VAT at 20% on his overall consumption based on the one meter covering the whole site, then I'm afraid you will have to bear this higher cost within the charge to you notwithstanding the fact your own consumption is less than 33kWh per day.
If he was VAT registered then you would be charged VAT at 5% being a domestic customer irrespective of what VAT rate is charged to the owner.I hope this is helpful and answers your question.