Vat after employee advantage discount.

[Alishalnr88]

Hi, ive recently been looking back at my bills for the past 18 months with vodafone. And ive noticed that i was paying my price plan is correct after the 20% is taken off but then im being charged vat ontop of that is this normal, why would they offer a 20 discount and then charge us the vat i thought vat was suppose to be included in the proce plan it clearly states this in t&cs

[Alishalnr88]

I honestly dont understand how that is right, if my plan is 48.50 inclusive of VAT. Then the 20% taken off makes the whole plan (advised inclusive of VAT) works out at 38.50 then how can the add VAT on after that?

[Magicman13]

I'll try to make it as simple as possible.

Your tariff, Including VAT is £48.50.

Your discount from this is 20%. If you deduct this amount, then you pay £38.80.

On your Tariff page of the bill, right where it says your tariff is £38.80 plus VAT, This is before your discount is applied.

So, £38.80 plus VAT (20%) is £48.50. That is how much your tariff is. Then you add tyour 20% discount. This takes the actual bill tyotal to £38.80 per month including VAT.

So it should look like this......

Tariff xxxxxxxx £38.80 plus VAT @ 20%.       (£38.80 + 20%VAT = £48.50)

Usage £0.00                                                           (£48.50 + £0.00 = £48.50)

Discount £9.70                                                       (£48.50 - £9.70 = £38.80)

Total after VAT £38.80

Just remember that the £38.80 plus VAT is before any discount has been applied. The discount is the last item applied.

I can't really simplify this any further.

Your total invoice will be £38.80 including VAT. (This is after your discount has then been applied).

[Annie_N]

I struggled to make sense of this, because I couldn’t see how some of the figures were arrived at. So I’ve re-worked it all from scratch, on the basis that the full cost of your plan (without the VEA discount) would have been £48.50 including VAT.

Full cost = £48.50 inc VAT = £40.42 + £8.08 VAT (@20%).

The discount of 20% (£8.08) is applied to the £40.42, giving £32.34.

VAT (@20%) is applied to £32.34 = £6.47.

Resulting charge = £32.34 + £6.47 = £38.81.

Because there’s some rounding in the VAT calculations, this produces a figure which is 1p higher than applying the 20% discount direct to the £48.50, but that’s unavoidable.

I quite agree that there is no way that VAT should be applied a second time to the £38.81.

Whatever the arithmetic on your bill, what are you actually having taken from your bank account?  That's the critical thing!

EDIT: I spent so long messing around with my calculations that I didn't see that @Magicman13 had replied in the meantime. I don't entirely understand his arithmetic, but we seem agreed that £38.80 (give or take the odd penny) is the correct answer!

[Magicman13]

I just used rounded figures and calculated the VAT in to the discount to save any confusion.

But either way, the 20% discount and the 20% VAT charge effectively cancel each other out and should leave a bill of £38.81.

Best way is to check the direct debit amount taken each month though as you say.

[Alishalnr88]

Like i said ill just have to deal with it until june and cancel with vodafone because as far as im aware they are adding vat on twice to my bill which is unacceptable.

[Alishalnr88]

Anne im paying for two lines and vat is added twice on both so my bills are working out around 88 pound after being told they would work out just over 70 pound.

[Annie_N]

Hi Alishalnr88

I presume the second account is for slightly less. If they were both for the same basic amount, it would add up to £77.62. But, no, you shouldn't be thinking in terms of leaving, we should be thinking in terms of getting this straightened out for you.

There's some silly mistake somewhere in your account, and it should be rectified. But dealing with these things over the phone or by online chat can be a total nightmare. I'm having a nightmare at the moment with BT - my tariff says 6p per minute plus a 15p setup charge per call to mobiles, but I'm being charged 12p per minute plus 15p. I've now made half a dozen calls, and have yet to talk to anyone in their accounts section who is numerate enough to understand the problem - each time I think I'm getting somewhere, they go off and consult their manager, then come back with "the difference is the VAT".:smileymad:

Magicman13 and I will raise a query over this, and then someone will come back to you here with some further advice. If you haven't already done so, subscribe to this topic (under Topic Options at the head of the thread) so that you get notification if anyone posts here.

Annie.

[Alishalnr88]

Yeah the other line is for 42.00 with the 20% added on. Yeah ive been trying to rectify this for the past few months theyve told me i havent been paying double but it is completely obvious on all my bills that i have. Trying to explain that ive been over paying for 18 months and being completely fobbed off.

[drey_p]

Hi there

When I sign into My Vodafone, it states my price plan is £48.50 which is correct as this is the price before any VEA discounts.

If I go to my billed usage, this is what I see:

Phone number  MR DREY_P on 4G Y10 24A ST UM UTX 7GB

Total for 07111 111 111	£42.34
Usage charges up to 16 Nov
Calls		£2.50
Messaging, mobile internet	VAT at 0%	£0.00
Messaging, mobile internet		£7.50
Service charges and credits
Your price plan     17 Nov to 16 Dec		£40.42
Discount on 4G Y10 24A ST UM UTX 7GB     17 Nov to 16 Dec		cr£8.08
CTR9 VF Euro Traveller Daily     17 Nov to 16 Dec		£0.00
Total for 07111 111 111	£42.34
This would be £50.81 including VAT

You will see that the employee advantage discount is based on the prices before VAT with VAT being added on at the end.  My charge this month is about £12 higher due to the EuroTraveller charges.

If you could post the information above, it would be really handy as we can help you decipher what is going on.

[Alishalnr88]

Well i never have unbilled usage as i have far more than enough to use on the phone.