VAT and prepayment tax registration dispute

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Piet
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Re: VAT and prepayment tax registration dispute

Post by Piet » Mon Jul 17, 2017 1:27 pm

molly_molly wrote:
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...
Correct me if I am wrong but if you are a company yourself like you say, you do not need to pay VAT to begin with.. so you can reclaim the VAT anyway? they just over charged you, the fact that their VAT registration is not in order, does not matter, you should not have been charged VAT anyway because you are a company and companies do not pay VAT (if YOUR registration is in order).

So I guess in this case, the remodeling company should refund you the VAT they charged, because they should not have charged it on the bill to your company. Basically they over charged your company, so you can to start with, send them an invoice with due date to refund the over charged money to your company, make sure the invoice is from your company!!!! if they do not pay, you can offer this bill for collection to a debt collector like interim justitia.. (you should get one with no cure no pay solution :wink: if those exist in Finland)
Maybe this will at least make sure the bill is open for the tax office and you can book it as a loss when not paid. (and therefore not pay income tax over the amount, even get tax back over it).

But this has been some time ago for me when I did these kind of Tax tricks so please investigate first... it might not work anymore.. (or might never have worked in Finland.. :evil: )


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Re: VAT and prepayment tax registration dispute

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heretostay
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Re: VAT and prepayment tax registration dispute

Post by heretostay » Mon Jul 17, 2017 2:21 pm

Piet wrote:
molly_molly wrote:
Rosamunda wrote:And they have collected the VAT from you.

Correct me if I am wrong but if you are a company yourself like you say, you do not need to pay VAT to begin with.. so you can reclaim the VAT anyway? they just over charged you, the fact that their VAT registration is not in order, does not matter, you should not have been charged VAT anyway because you are a company and companies do not pay VAT (if YOUR registration is in order).

So I guess in this case, the remodeling company should refund you the VAT they charged, because they should not have charged it on the bill to your company. Basically they over charged your company, so you can to start with, send them an invoice with due date to refund the over charged money to your company, make sure the invoice is from your company!!!! if they do not pay, you can offer this bill for collection to a debt collector like interim justitia.. (you should get one with no cure no pay solution :wink: if those exist in Finland)
Maybe this will at least make sure the bill is open for the tax office and you can book it as a loss when not paid. (and therefore not pay income tax over the amount, even get tax back over it).

But this has been some time ago for me when I did these kind of Tax tricks so please investigate first... it might not work anymore.. (or might never have worked in Finland.. :evil: )
I have a company. We always pay VAT and bill VAT to everyone. You claim it back on your monthly/quarterly vero report if you overpay and you pay to vero if you took in more VAT than you paid out. VAT is always billed to companies even though they don't end up paying it in the end and this is why the OP is in this situation.


Rosamunda
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Re: VAT and prepayment tax registration dispute

Post by Rosamunda » Mon Jul 17, 2017 4:41 pm

Piet wrote: Correct me if I am wrong
You are wrong.
but if you are a company yourself like you say, you do not need to pay VAT to begin with..
Wrong. Even companies have to pay purchase VAT. But, they are able to deduct it from the sales VAT that they collect from their own customers on behalf of the State. In other words, it's a cash flow issue: so when a company buys a product or service from another company, it has to pay VAT - there is definitely a cash transaction including VAT at the point of purchase.
the fact that their VAT registration is not in order, does not matter,
Yes it does. The onus is on the buyer to check that the supplier is appropriately registered. See the previous threads and the links.
you should not have been charged VAT anyway because you are a company and companies do not pay VAT (if YOUR registration is in order).
Wrong. Just wrong. Of course companies have to pay VAT if they are buying services (eg inside Finland as in this case). As explained above, the purchase VAT is deducted from the sales VAT collected and the net amount is then transfered to the state treasury.
So I guess in this case, the remodeling company should refund you the VAT they charged, because they should not have charged it on the bill to your company. Basically they over charged your company
,
This is correct but the OP already asked them to refund the difference and they refused.
so you can to start with, send them an invoice with due date to refund the over charged money to your company, make sure the invoice is from your company!!!!
From an accounting point of view, this is not possible. It has to be a credit note from the original service provider.
if they do not pay, you can offer this bill for collection to a debt collector like interim justitia.. (you should get one with no cure no pay solution :wink: if those exist in Finland)
Maybe this will at least make sure the bill is open for the tax office and you can book it as a loss when not paid. (and therefore not pay income tax over the amount, even get tax back over it).
As above. Not doable.
But this has been some time ago for me when I did these kind of Tax tricks so please investigate first... it might not work anymore.. (or might never have worked in Finland.. :evil: )
Nope. Never been possible in Finland.


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Piet
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Re: VAT and prepayment tax registration dispute

Post by Piet » Mon Jul 17, 2017 9:43 pm

Rosamunda wrote:
Piet wrote: Correct me if I am wrong
You are wrong.
But this has been some time ago for me when I did these kind of Tax tricks so please investigate first... it might not work anymore.. (or might never have worked in Finland.. :evil: )
Nope. Never been possible in Finland.
Yeah I was afraid of that, (hence my last remark) but I have lived in so many places (countries) that tax rules are a bit mixed up by now, especially the VAT rules... ... :ochesey:

It sucks to do business in Finland... :lol: it seems you cannot get the tax rules work for you here, all is calculated in favor of the state first. Luckily the social benefit rules still have some room for having them work for you instead of against you ALL the time.. :wink:

Well I guess OP is screwed here,

I am so happy I am eläke :D
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Rosamunda
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Re: VAT and prepayment tax registration dispute

Post by Rosamunda » Tue Jul 18, 2017 8:04 am

Tax happens. It gives us free education, healthcare and stuff like that. The State gives businesses a 2-3 month cash flow benefit before the VAT is due. I pay mine just once a year. Since my bigger purchases are at 24% and I sell a lot at 14% (food products) my net VAT liability is quite low.

Which country did you live in where you could buy without paying VAT?


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Piet
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Re: VAT and prepayment tax registration dispute

Post by Piet » Tue Jul 18, 2017 8:26 pm

Rosamunda wrote:Tax happens. It gives us free education, healthcare and stuff like that. The State gives businesses a 2-3 month cash flow benefit before the VAT is due. I pay mine just once a year. Since my bigger purchases are at 24% and I sell a lot at 14% (food products) my net VAT liability is quite low.

Which country did you live in where you could buy without paying VAT?
The Netherlands, business to business transactions were (if both companies are registered) possible without paying VAT, the first business sells to the second without VAT and therefore does not need to pay this to the Tax office, the receiving business (of the goods) would charge their private customers VAT and pay this to the Tax office. this was to relief workload and money flows for nothing between Tax office and all companies.
It is no use to first ask a company for vat, pay this to the tax office and the next company reclaim this from tax and then charge the customers for tax and pay this to the tax office or recalculate... much easier and quicker for both tax office and businesses to skip the in between taxes... only the private customer pays the VAT and the company selling to the private customer pays to the state.

But that is a while ago for me, my accountant knows more about this... :lol:

edit: not for all businesses!!

some information but this is in dutch :ochesey: https://www.belastingdienst.nl/wps/wcm/ ... sregeling/
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betelgeuse
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Re: VAT and prepayment tax registration dispute

Post by betelgeuse » Wed Jul 19, 2017 1:15 am

Piet wrote:It is no use to first ask a company for vat, pay this to the tax office and the next company reclaim this from tax and then charge the customers for tax and pay this to the tax office or recalculate... much easier and quicker for both tax office and businesses to skip the in between taxes... only the private customer pays the VAT and the company selling to the private customer pays to the state.
This only holds if you assume honesty.


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Piet
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Re: VAT and prepayment tax registration dispute

Post by Piet » Thu Jul 20, 2017 9:30 am

betelgeuse wrote:
Piet wrote:It is no use to first ask a company for vat, pay this to the tax office and the next company reclaim this from tax and then charge the customers for tax and pay this to the tax office or recalculate... much easier and quicker for both tax office and businesses to skip the in between taxes... only the private customer pays the VAT and the company selling to the private customer pays to the state.
This only holds if you assume honesty.
That is correct, that is why the tax office found a way to make sure, the selling company needs to report the sale without VAT in its tax administration as the receiving party needs to do. This is for checking purposes and detecting fraud.

So eventually the only benefit is the lower money flow between all parties and the tax office. The administrative burden so to say, stays the same.

The sort of companies that are eligible for this system, are also limited, the biggest group of companies eligible, is between contractors and sub contractors (construction, ship construction and cleaning / gardening) and international business, waste and old materials, mobile phones laptops game computers, chips, tablets, gold, real estate, emission rights, etc.
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Rosamunda
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Re: VAT and prepayment tax registration dispute

Post by Rosamunda » Thu Jul 20, 2017 10:20 am

Scrap metal dealers, estate agents, building subcontractors...?

Hmmm.


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foca
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Re: VAT and prepayment tax registration dispute

Post by foca » Thu Aug 10, 2017 12:45 am

There is one more thing to consider here. If it is construction business where the payments are made in it might fall under the construction VAT scheme . Basically when used this scheme transfer the responsibility to pay vat to the buyer . But applicability of the scheme in this case requires more information.
Another thing ... I think that VAT registration and income tax prepayment register registration cannot just "expire" . A company voluntary may unregistered under certain condition but these registrations surely cannot just expire
What do you want from me?????


Rosamunda
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Re: VAT and prepayment tax registration dispute

Post by Rosamunda » Sat Aug 12, 2017 10:50 pm

But isn't the reverse charge VAT for construction companies only applicable when either the buyer or seller is based outside FInland?


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