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Alex J.
Alex J., Solicitor
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Experience:  Solicitors 2 years plus PQE
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I am a small startup selling through online market places and

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I am a small startup selling through online market places and am UnRegistered for VAT.
I made some purchases from an EU supplier towards the end of last year. The supplier confirmed VIA EMAIL that as long as I PREPAY there is no VAT (20%) to be paid to them. And the purchases will be classed as an import.
I made some purchases on PREPAID basis and resold the products through Ebay considerring the price paid with some margin.
Now after two months I have received an invoice (VAT on all the purchases) explaining that it was a mistake on their part . They should have charged the VAT.
Are they able to force me to pay the VAT.
Hi, Thank you for your question and welcome. My name is ***** ***** I will assist you. Under English Law if you quote a price as not chargeable to VAT you cannot then subsequently charge VAT. Considering this point, did you sign any terms and conditions with the supplier when you purchased the goods? Kind regards AJ
Customer: replied 2 years ago.
Thanks for a quick response.I attach standard T&C from their websiteSome email exchange before openning up the account.Hi Bilal,Please see below;What is the ETA for uk? – We can deliver anywhere in the EU on a next day delivery, so next day for UKAverage UK delivery cost? £10 is the standard next day costAre displayed prices inclusive of VAT? There is no VAT to pay with us, because our stock is all shipped form our warehouse in the Netherlands, it is classed as imports – so no VAT to pay, I can explain further if neededDo the products come with UK 3pin plug adaptors? – Yes all products will come with UK adapters and full UK/EU warrantiesDo you offer white label drop ship option. (DIRECT TO CUSTOMER) – Yes, all of our direct ship to customer orders are pain label------------------------------------------------------------------------------------------------
***** ***** 10/19/15to meHi Bilal,
Hope all is well?
I have tried to get hold of you a couple of times but not had any luck.
Would you be able to fill out the attached form for me and I will get your company setup with us and we can take it from there?
Being VAT registered currently is not an issue if you ar epaying upfront.
Any questions you have, please feel free to drop me a call/ email.
I look forward to working with you.
Kind regards
From: Bilal Faiz [mailto***@******.***]
Sent: 08 October 2015 14:29
To: ***** ***** uk
Subject: New account information
We are a new business and are currently selling products through online market places.
Here is the company information
Company number:09638755
We are not yet registered for VAT.
Please let us know how can we setup an account with Xeptor.
Please note we are not looking for payment terms. We are happy with prepaid only account.
We look forward to an affirmative response.
I can be contacted on 0203(###) ###-####
Kind Regards
Bilal FaizKind regardsJoe
Hi, Thank you. If you look at Clause 3.1 it states - All prices are exclusive of turnover tax (VAT) and/or other levies which have been or will be imposed by the authorities and exclusive of any additional expenses (such as dispatch, transport, insurance, assembly, commissioning, demonstration, etc.). Unless otherwise indicated, prices are in euros and the customer must pay in euros. C0nsidering clause 3.1 and the highlighted part, it does suggest that if VAT does become payable you may be liable to pay it. What I cannot see is a clause that says the customer is liable to pay all VAT levied on the items. Normally this is implied but the situation here is you were led to believe no VAT was chargeable on the items. There is no other clause in this document that allows them to charge you VAT in the event that they have "made a mistake". Would you want to continue working with this supplier in the future?
Customer: replied 2 years ago.
I have been ordering through their UK website and have been dealing with their sales person in the UK.I have been charged/paid in GBPNo I do not wish to continue with this supplier.What are my options in this situation?Kind Regards
Customer: replied 2 years ago.
All the orders however have been despatched and invoiced through Netherlands.Kind Regards
Hi, Thank you. Your options are you refuse to pay, they quoted the fees as not chargeable to VAT and there is no where in the documentation that allows them to hold you accountable for a VAT charge after the invoice and service has been rendered. If they feel they have grounds to recover it, they will have to sue you and you will have to defend yourself. The other alternative if you can try and settle with them - say they made the mistake and therefore they must take some responsibility - you could split the cost with them to alleviate any risk that you might be sued in the future? Kind regards AJ
Customer: replied 2 years ago.
So If they employ a colection agency , do I have grounds to defend the charge or counter sue them?Kind Regards
Hi, Thank you. If they employ a collection agency, I would write to them and say if that you reserve to pursue them for the costs of defending the claim and interruption to your business. Ultimately what will the collection agency do? They wont be able to do much especially if the debt is disputed, this supplier would need to take you to court first.
Customer: replied 2 years ago.
Great . Thanks for your help.Would you be available for help in future if required. And how do I ensure my future requests are passed onto you.Kind Regards
Hi, Thank you. Please just request Alex J. If you have any follow up points on this thread please do not hesitate to contact me. Kind regards AJ
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Customer: replied 2 years ago.
Thanks Alex, you've been very helpful. I shall us this in my discussions with them.