does VAT need to be paid when paying off phone contract?

16
Found 24th May 2011
Thinking of paying o2 contract off early - what are the benefits to this please ?

Thanks
James

16 Comments

Banned

You pay vat on a monthly basis don't you

The final payment for the months not used should be vat free (saving 20%) as the service hasn't been used.

When they generate the final bill it should automaticly not charge the vat, but always best to check it.
Edited by: "steve1221" 24th May 2011

Just to piggy back, would T-Mobile not releasing Windows Phone 7 updates since November constitute a breach of contract, when the advertsing spiel on the website ensures all updates etc etc

Alfonse

Just to piggy back, would T-Mobile not releasing Windows Phone 7 updates … Just to piggy back, would T-Mobile not releasing Windows Phone 7 updates since November constitute a breach of contract, when the advertsing spiel on the website ensures all updates etc etc



I'd think not. I can't think of clause in their T&C's that state they'll guarantee to provide updates. Sorry.

Original Poster

steve1221

The final payment for the months not used should be vat free (saving 20%) … The final payment for the months not used should be vat free (saving 20%) as the service hasn't been used.When they generate the final bill it should automaticly not charge the vat, but always best to check it.



Have you had experience if this please?

james_lfc

Have you had experience if this please?



Only that I work for Orange.

Alfonse

Just to piggy back, would T-Mobile not releasing Windows Phone 7 updates … Just to piggy back, would T-Mobile not releasing Windows Phone 7 updates since November constitute a breach of contract, when the advertsing spiel on the website ensures all updates etc etc



Advertising spiel on t-mobiles website ? if your expectation was to get updates and you aren't getting them then you can argue breach of contract!

Oh and Steve1221 I so hope you DON'T work for Orange's legal dept.....the T&C would need to explicitly say "you won't get upgrades" to allow them to wriggle free from their contract obligations and/or responsibilities.

Original Poster

steve1221

Only that I work for Orange.



Excellent mate, cheers! Is this just oranges procedures then or is it the law?

Its my understanding that VAT is changed on a service provided. If you cancel they are not providing the service, therefore there's no VAT.

Take a look on MSE, the question comes up there at least once a month.

Alfonse; No mate, I'm not in legal. I'm a fraud investigator.

Yes, you will be charged VAT when ending contract early. The only benefit is that you finish your contract earlier.

Trauts78

Yes, you will be charged VAT when ending contract early. The only benefit … Yes, you will be charged VAT when ending contract early. The only benefit is that you finish your contract earlier.



Im sure theywould love you too boost their profits like that but its not really eeded.

VAT isnt charged when terminating your contract.. but im sure they wouldbe happy emough to let you pay an extra 20% if you demaded to

Original Poster

According to o2, VAT is to be paid when paying off a contract? and no early termination discount can be offered, are they trying to fob me off?

james_lfc

According to o2, VAT is to be paid when paying off a contract? and no … According to o2, VAT is to be paid when paying off a contract? and no early termination discount can be offered, are they trying to fob me off?



I tried to cancel mine early and they included VAT in the final charge, so you not the only one

"The termination charge would be:

- the amount of months remaining in contract  - 4 month ( including your
30 days notice period)
- multiplied by the monthly line rental charge -15.32 ( including VAT )
- plus any outstanding balances due on the account.

The termination charges for your account would approximately be 15.32*4
= £61.26"

Banned

ring hmrc?

I am also thinking of cancelling my o2 contract.

If I terminate it early, how would I go about porting my number to a new provider?

Banned

moneysaver9988

Im sure theywould love you too boost their profits like that but its not … Im sure theywould love you too boost their profits like that but its not really eeded.



the service provided is the phone, the contract is for the entire year the phone is subsidised it is a service. Having read those moneysavingidiot forums they are none the wiser either.
Edited by: "lumoruk" 12th Jul 2011
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