As most of us are probably aware, from tomorrow (1st December), Value Added Tax (VAT) will be cut from 17.5% to 15% as part of the Government’s recent measures to stimulate the economy.
A few retailers have already cut their prices to reflect the change to VAT (both from a marketing and a practical perspective, we suspect), but what might not be so well known is that certain retailers will pay the difference between what you may have just paid for an item and the price it will be from tomorrow.
This is because tax gets charged at varying points in the purchase process, depending on where you’ve bought your items from. To simplify, ths usually means where you’ve ordered goods and paid for them, but are yet to receive them – for example if you’ve ordered a new sofa, but it’s yet to arrive.
The list below, taken from The Times, shows the VAT reclaim policies of a few major retailers:
|John Lewis||Yes, if you’ve paid and not received goods|
|Currys, PC World||Yes, if you’ve paid and not received goods|
|House of Fraser||No refund available|
|Debenhams||No refund available|
|M&S||Yes, if you have not received your goods|
|B&Q||Yes, but you must cancel and re-order|
|Ikea||Yes, on all goods bought since Monday|
If you’ve got products on order anywhere, it’s worth finding out whether they have a refund policy in force for this situation (oh, and let us know in the comments below so others can benefit too, thanks!).
Whilst the savings on smaller items might not be huge (and might not even merit a phone call to sort out), if you have got larger items on order, then it could save you a fair amount of cash. For example, on a Â£10,000 kitchen you could save over Â£200.
This also applies to services – if you’ve got some work in the pipeline, but have yet to be invoiced for it, you should pay the new rate of VAT, not the old.