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Solicitors and VAT

Solicitors and VAT

Postby shootist » Mon Oct 05, 2015 10:38 am

No idea if this is in the right section but here goes anyway.

A solicitor is asked to estimate the cost of a piece of work, and does so. The work is done and the bill is presented with the correct figure shown but then with VAT added. Is this correct? The work was requested by a company limited by guarantee, but which is not a trading company.
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Re: Solicitors and VAT

Postby atticus » Mon Oct 05, 2015 10:45 am

Oh dear. It has been drummed into me and every solicitor I know that fee quotes are to be expressed as £x plus VAT.

I think the solicitor may have messed up there. Check what the client care letter says.

See para 2.3
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Re: Solicitors and VAT

Postby shootist » Mon Oct 05, 2015 2:30 pm

Thanks for that.
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Re: Solicitors and VAT

Postby atticus » Mon Oct 05, 2015 3:14 pm

Don't forget to look at the client care letter. This may well have put the fee quote in writing.
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Re: Solicitors and VAT

Postby shootist » Tue Oct 06, 2015 7:29 am

atticus wrote:Oh dear. It has been drummed into me and every solicitor I know that fee quotes are to be expressed as £x plus VAT.


Not disputing what you say at all, but thinking back to my T/S days when I was dealing with pricing complaints from consumers it was always the case that a selling price for goods or services (IIRC) had to state the final price. Giving a price and just saying 'plus VAT' was a no no as it would give a false impression to the customer. Plumbers merchants who also sell to the public were a classic example. I had quite a barney with one large international company that runs a sort of cash and carry style 'supermarket' on a membership basis over their labelling that displayed the ex VAT price on a large label with the VAT inclusive price on a tiny label nearby. Unfortunately, they had loads of money and my department had virtually none and were utterly spineless to boot so it went nowhere.

I'm assuming there is some exception to the pricing rules, or indeed even that they do not apply to sillysoders.

Thanks again for the input.
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Re: Solicitors and VAT

Postby atticus » Tue Oct 06, 2015 7:39 am

I think that is not correct.
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Re: Solicitors and VAT

Postby shootist » Tue Oct 06, 2015 8:03 am

atticus wrote:I think that is not correct.


Any particular part?
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Re: Solicitors and VAT

Postby dls » Tue Oct 06, 2015 8:30 am

Two sets of rules apply.

VAT rules requires a price given to a consumer to be inclusive of VAT. A price given to someone who is registered for VAT can be exclusive.

Solicitors must follow those rules and additionally professional ones.

There remains little point in quoting a VAT inclusive price to a registered buyer - it does not tell him what he needs to know.
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Re: Solicitors and VAT

Postby miner » Tue Oct 06, 2015 1:22 pm

dls wrote:Two sets of rules apply.

Solicitors must follow those rules and additionally professional ones.



And when they don't, what happens?

How many instances are there on record where solicitors have been disciplined by the SRA for such a breach?
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Re: Solicitors and VAT

Postby dls » Tue Oct 06, 2015 7:45 pm

Very probably very many, but if the result of the breach is that the solicitor pays the VAT out of the sum agreed, that would appear to be enough penalty. It is not something for people to get their knickers sufficiently twisted to not be resolved with a simple penalty from which all move on.
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