MegaSack DRAW - This year's winner is user - rgwb
We will be in touch
I have a car on PCP (the lease agreement, not the drugs).
A few weeks ago I got an email informing me of an extra charge due to the rise in VED. VED has gone up this year from £155 to £165 so I queried why they've charged me £24 quid for a £10 increase. They replied saying that it's gone up £20 in the two years since I took out the lease and agreed repayments, which is something I hadn't considered and is fair enough. But... so where's that other £4 come from, then?
They've told me this is VAT. I pointed out that VED isn't £165+VAT, it's £165, and I got this reply:
The road fund licence is included within the lease rental and is therefore subject to VAT.
The change in vehicle excise licence amount is an adjustment to the lease rental and follows the same VAT treatment as the lease. Therefore we charge VAT on the adjustment.
Does that sound right, is it normal practise? OK, in the grand scheme of things I know I'm being petty, I'm querying a charge of six quid over the length of the lease because I want to understand unexpected demands for money. Can they just arbitrarily add on VAT to something that isn't subject to VAT because it's part of the lease?
Yes it's normal. Same as companies charging VAT on postage even of the postage doesn't include vat.
^^^^ That. We charge VAT on our managed hosting services as it is classed as a professional service however we don't pay VAT on hosting from our provider.
Can they just arbitrarily add on VAT to something that isn’t subject to VAT because it’s part of the lease?
Yes.
The lease company are providing you with a service
All services are subject to VAT
count yourself lucky they aren't charging you £24 (plus VAT) for writing to you to tell you you've been undercharged on your VED.
Plus interest on the £20 (+ VAT) that they've loaned you for the past 2 years 😉