Is it neccesary to display VAT on delivery in UK?

I am creating 2 online shops based in UK using Hikashop (with help from Nicolas ) that ship the UK only and was wondering if I am required by law or similar to show vat for shipping in checkout or if I can just apply a flat fee and simply mention that the delivery cost includes VAT either in the terms & conditions page or somewhere visible on the website itself?

I notice that some competitors dont mention it at all, some do add it and other simply have a flat fee and say that the VAT is included on the side of the site....

I just want to make sure!!

I look forward to any replies on this!
thanks

Well, it can be complicated (of course), presuming your client is VAT registered the safest thing to do is show a full VAT invoice all the time from your programing point of view (the rules is full invoice for £250 or over, simple invoice for £250 or under, but you can use full invoice from zero up )

below is extract from ukgov site : (the important bit, you need to know this regardless)

A VAT invoice must show:

an invoice number which is unique and follows on from the number of the previous invoice - if you spoil or cancel a serially numbered invoice, you must keep it to show to a VAT officer at your next VAT inspection
the seller's name or trading name, and address
the seller's VAT registration number
the invoice date
the time of supply (also known as tax point) if this is different from the invoice date - see below
the customer's name or trading name, and address
a description sufficient to identify the goods or services supplied to the customer

For each different type of item listed on the invoice, you must show:

the unit price or rate, excluding VAT
the quantity of goods or the extent of the services
the rate of VAT that applies to what's being sold
the total amount payable, excluding VAT
the rate of any cash discount
the total amount of VAT charged

If you issue a VAT invoice that includes zero-rated or exempt goods or services, you must:

show clearly that there is no VAT payable on those goods or services
show the total of those values separately

If you make retail sales and you make a sale of goods or services for £250 or less including VAT you can issue a simplified VAT invoice – see the section in this guide on simplified VAT invoices.

Now the delivery part !

Postage, packing and delivery within the UK included in the sales contract but charged for separately, eg mail order has the same rate as the goods being delivered or posted

Postage, packing and delivery within the UK charged as an optional extra is always standard-rated

So safest option is to charge and show this on the invoice as standard rate (20% at the moment)


ie.

My company
My Address

VAT Num : my vat num
Dated : todays date



Item Unit Price Quantity Total Price
(ex vat) (ex vat)

My Goods £10.00 2 £20.00

Delivery £10.00 1 £10.00


TOTAL ex vat £30.00

VAT @ 20% £6.00

TOTAL inc vat £36.00


That will cover all bases Presuming trading address is the same as registered address, if not, that needs to be there as well.

Well, it can be complicated (of course), presuming your client is VAT registered the safest thing to do is show a full VAT invoice all the time from your programing point of view (the rules is full invoice for £250 or over, simple invoice for £250 or under, but you can use full invoice from zero up )

below is extract from ukgov site : (the important bit, you need to know this regardless)

A VAT invoice must show:

an invoice number which is unique and follows on from the number of the previous invoice - if you spoil or cancel a serially numbered invoice, you must keep it to show to a VAT officer at your next VAT inspection
the seller's name or trading name, and address
the seller's VAT registration number
the invoice date
the time of supply (also known as tax point) if this is different from the invoice date - see below
the customer's name or trading name, and address
a description sufficient to identify the goods or services supplied to the customer

For each different type of item listed on the invoice, you must show:

the unit price or rate, excluding VAT
the quantity of goods or the extent of the services
the rate of VAT that applies to what's being sold
the total amount payable, excluding VAT
the rate of any cash discount
the total amount of VAT charged

If you issue a VAT invoice that includes zero-rated or exempt goods or services, you must:

show clearly that there is no VAT payable on those goods or services
show the total of those values separately

If you make retail sales and you make a sale of goods or services for £250 or less including VAT you can issue a simplified VAT invoice – see the section in this guide on simplified VAT invoices.

Now the delivery part !

Postage, packing and delivery within the UK included in the sales contract but charged for separately, eg mail order has the same rate as the goods being delivered or posted

Postage, packing and delivery within the UK charged as an optional extra is always standard-rated

So safest option is to charge and show this on the invoice as standard rate (20% at the moment)


ie.

My company
My Address

VAT Num : my vat num
Dated : todays date



Item Unit Price Quantity Total Price
(ex vat) (ex vat)

My Goods £10.00 2 £20.00

Delivery £10.00 1 £10.00


TOTAL ex vat £30.00

VAT @ 20% £6.00

TOTAL inc vat £36.00


That will cover all bases Presuming trading address is the same as registered address, if not, that needs to be there as well. oops formatting removed example see attached

thanks that is an amazing responce... I am shocked that some pretty large companies are NOT showing the VAT on delivery at checkout... are they breaking the law?

Also, for one of the sites I am creating, the client is NOT VAT registered so does that mean VAT on delivery is not needed?

well, that was the basic rules , of course being tax and government there ar complications ! Certain types of products (brochures arent taxed, but leaflets are etc) and certain types of delivery dont need to be taxed, but the way the rules work are if you didnt tax it and it should have been then you pay, so best to err on caution else you will be left out of pocket.

Just to confuse everyone of course
Postal services provided by the Post Office are exempt from VAT, but this exemption does not extend to similar services provided by other suppliers, even where this might be seen as being in direct competition with the Post Office. However, if any delivery charge you make to your own customers includes the cost of stamps you buy from the Post Office you may have to charge VAT on the whole amount including the cost of those stamps.

Confusing huh, thats why you apply vat to all call it delivery and charge it, its worth it in the end. Of course if your company is under the VAT registration limit (currently £77,000) but hey, lets not go there !

So make sure you display all info on the attached, and you are sorted

and yes, if hes not vat registered you cant charge VAT on anything on the invoice, as you cant display a vat number etc.

(ps Im not a expert by any means, just ran my own business for many years!)

thanks guys... great replies to my questions..