VAT and prepayment tax registration dispute

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molly_molly
Posts: 28
Joined: Fri Nov 04, 2016 6:32 pm

VAT and prepayment tax registration dispute

Post by molly_molly » Sun Jul 09, 2017 11:48 pm

Hello, I would need some legal help about tax registration. So I paid a construction company to do a remodelling work on my flat a few weeks ago. They sent me invoices every week and I paid according to it. Then I found on BIS that the VAT and prepayment tax registration of this company has expired, but the payment they sent on the invoice is with the 24% VAT, which means they actually won't pay the VAT to the tax office but they charged me with VAT. The worse thing is about the prepayment tax registration, since they don't register for this prepayment tax, I have to pay 13% of the net payment for them to the tax office.

I have contacted the foreman of the remodelling work and asked them to return the 24% VAT and also compensate me the 13% of the net payment. But they said there is no problem on their VAT and prepayment tax registration. If I show them the information I found on BIS, but they still refuse to return me the payment. What should I do. Should I call the police or find a lawyer to help? Please give me some advises. Thank you very much in advance.

VAT and prepayment tax registration dispute

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betelgeuse
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Re: VAT and prepayment tax registration dispute

Post by betelgeuse » Mon Jul 10, 2017 12:17 am

molly_molly wrote:If I show them the information I found on BIS, but they still refuse to return me the payment. What should I do. Should I call the police or find a lawyer to help? Please give me some advises. Thank you very much in advance.
When you don't get the other party to pay voluntarily, your only option to collect is through the courts. You would want a lawyer for that and he/she can then advice on other other aspects of the case. Whether to try and do anything is unclear since the company is likely to be broke.


molly_molly
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Re: VAT and prepayment tax registration dispute

Post by molly_molly » Mon Jul 10, 2017 12:37 am

betelgeuse wrote:
molly_molly wrote:If I show them the information I found on BIS, but they still refuse to return me the payment. What should I do. Should I call the police or find a lawyer to help? Please give me some advises. Thank you very much in advance.
When you don't get the other party to pay voluntarily, your only option to collect is through the courts. You would want a lawyer for that and he/she can then advice on other other aspects of the case. Whether to try and do anything is unclear since the company is likely to be broke.

Hey, betelgeuse, thanks for the reply. So if I do sue the company, and they really go broke, and that's it? I mean, it's already a commercial fraud I think, and the people who's in charge in the company can just walk away without any punishment and maybe do the same thing to another person again with a new registered company? Could I sue the person who signed the remodelling contract with me and ask him personally to compensate my loss?


Rosamunda
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Re: VAT and prepayment tax registration dispute

Post by Rosamunda » Mon Jul 10, 2017 10:22 am

It might depend on what kind of company he has: Oy (limited co) Ky or toiminimi (sole trader).

If he owes money to Vero, they won't let him get off. Don't worry!

But IIRC tge onus is on the buyer to check for VAT registration and current status. Definitely worth doing when dealing with sole traders and small businesses. Especially if you want to deduct the work from your income tax....(home improvements tax break)


molly_molly
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Joined: Fri Nov 04, 2016 6:32 pm

Re: VAT and prepayment tax registration dispute

Post by molly_molly » Tue Jul 11, 2017 12:05 am

Rosamunda wrote:It might depend on what kind of company he has: Oy (limited co) Ky or toiminimi (sole trader).

If he owes money to Vero, they won't let him get off. Don't worry!

But IIRC tge onus is on the buyer to check for VAT registration and current status. Definitely worth doing when dealing with sole traders and small businesses. Especially if you want to deduct the work from your income tax....(home improvements tax break)
Hey, thanks for the information. I think they are Oy. And my friend just told me as well it should be my responsibility to check their tax status before I paid the invoice. But I'm a foreigner, who knows I should do that, and I have paid so many invoices in Finland before and this kind of thing never happened. Could I just ask Vero to request them pay the VAT and the prepayment tax? Do you think Vero would help me?


Rosamunda
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Re: VAT and prepayment tax registration dispute

Post by Rosamunda » Tue Jul 11, 2017 1:21 pm

Generally speaking, Vero (tax office) is very helpful - after all, they have nothing to gain from being obnoxious to taxpayers! So, I guess you could call them and explain your situation in all honesty and ask them for some advice. They might take pity on you and they might also be very interested to see the invoices that the company sent you. :wink:

Or, maybe there is just some misunderstanding that could be sorted out without the need to involve lawyers.


betelgeuse
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Re: VAT and prepayment tax registration dispute

Post by betelgeuse » Tue Jul 11, 2017 1:32 pm

Rosamunda wrote:Generally speaking, Vero (tax office) is very helpful - after all, they have nothing to gain from being obnoxious to taxpayers! So, I guess you could call them and explain your situation in all honesty and ask them for some advice. They might take pity on you and they might also be very interested to see the invoices that the company sent you.
Vero definitely cares about people charging VAT without being in the VAT-register. It's an open question for me whether the buyer has a duty to check that. I am leaning towards no but would have to check.


Rosamunda
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Re: VAT and prepayment tax registration dispute

Post by Rosamunda » Tue Jul 11, 2017 2:36 pm

My understanding was that in B2B transactions the buyer needs to ensure that the seller is registered. I'm not sure about B2C (which I guess is the case here). It seems unreasonable to expect ordinary people to log on to the Trade Registry and check a company's status...


Upphew
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Re: VAT and prepayment tax registration dispute

Post by Upphew » Tue Jul 11, 2017 3:00 pm

Rosamunda wrote:It seems unreasonable to expect ordinary people to log on to the Trade Registry and check a company's status...
Like write on phone ytj.fi and typing the name of the company or y-tunnus? Doesn't seem too unreasonable for me.
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betelgeuse
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Re: VAT and prepayment tax registration dispute

Post by betelgeuse » Tue Jul 11, 2017 3:50 pm

Rosamunda wrote:My understanding was that in B2B transactions the buyer needs to ensure that the seller is registered. I'm not sure about B2C (which I guess is the case here). It seems unreasonable to expect ordinary people to log on to the Trade Registry and check a company's status...
There is a requirement for the buyer to check the registration in the withholding register when buying human work for both B2B and B2C. Households do get an exception of 1500 euros per employee per year.

https://www.vero.fi/syventavat-vero-ohj ... _ennakon8/


betelgeuse
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Re: VAT and prepayment tax registration dispute

Post by betelgeuse » Tue Jul 11, 2017 3:52 pm

Upphew wrote:
Rosamunda wrote:It seems unreasonable to expect ordinary people to log on to the Trade Registry and check a company's status...
Like write on phone ytj.fi and typing the name of the company or y-tunnus? Doesn't seem too unreasonable for me.
If you don't check, you don't even know if you are dealing with a real company. Would you make a significant contract with someone without checking their id?


molly_molly
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Re: VAT and prepayment tax registration dispute

Post by molly_molly » Wed Jul 12, 2017 12:31 pm

betelgeuse wrote:
Upphew wrote:
Rosamunda wrote:It seems unreasonable to expect ordinary people to log on to the Trade Registry and check a company's status...
Like write on phone ytj.fi and typing the name of the company or y-tunnus? Doesn't seem too unreasonable for me.
If you don't check, you don't even know if you are dealing with a real company. Would you make a significant contract with someone without checking their id?
Well, actually, I did check their VAT and prepayment status when we signed the contract, and their registration expired after a few days we signed the contract. So when their first invoice arrived, their VAT and prepayment registration has expired already and I didn't check again when I started to pay the invoice...


Upphew
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Re: VAT and prepayment tax registration dispute

Post by Upphew » Wed Jul 12, 2017 1:31 pm

molly_molly wrote:Well, actually, I did check their VAT and prepayment status when we signed the contract, and their registration expired after a few days we signed the contract. So when their first invoice arrived, their VAT and prepayment registration has expired already and I didn't check again when I started to pay the invoice...
Imho that sounds like you did your due diligence and you might have a fraud case in your hands.
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Rosamunda
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Re: VAT and prepayment tax registration dispute

Post by Rosamunda » Wed Jul 12, 2017 3:50 pm

And they have collected the VAT from you.
Who told you to pay the 13% to Vero?


molly_molly
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Joined: Fri Nov 04, 2016 6:32 pm

Re: VAT and prepayment tax registration dispute

Post by molly_molly » Sun Jul 16, 2017 1:20 am

Rosamunda wrote:And they have collected the VAT from you.
Who told you to pay the 13% to Vero?
Hey, it was the person who does the bookkeeping for me, cause I'm working as toiminimi, and this remodelling is for my office. So I was expecting to deduct the 24% VAT afterwards, and found the payment is not deductible, namely, I paid the construction company more than I was suppose to pay...


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