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BT Ireland: Changing from bus. to home a/c - cant claim VAT?

  • 03-05-2007 3:35pm
    #1
    Naked Giant
    Closed Accounts Posts: 4 ✭


    BT claim that if I change from a business to a home a/c I cannot claim VAT on bills.

    BT have some great home bundle deals at the moment and I want to change.
    Im a sole trader working in a small office with a single phone and broadband line.

    Surely regardless of how BT class me it's a business expense. I dont live in the premises and its nothing to do with them either way.
    When sole traders work from home they are allowed to nominate a portion of their phone bill as business expense so I should surely be allowed to claim VAT back.

    Im currently paying:

    EUR45 a month for BT broadband @ 2MB
    EUR20 a month for Eircom for rental + calls (of which I make very few)
    TOTAL = 65 euro + VAT

    For 63 per month (including VAT) I can get 3MB broadband, line rental and all national/UK landline calls so regardless it makes sense for me to change.

    Surely I can claim the VAT off this though as its an expense no matter what way you look at it??
    Any comments? Am I missing something?


Comments

  • #2
    eggie
    Closed Accounts Posts: 880 ✭✭✭eggie


    When they charge you VAT (input tax) on your bills you can deduct this from what you owe the revenue on your sales (output tax). None of BT's business concerning your VAT registration situation.

    If you are using the utilities for both home and business then you will obviously have to work out a fair ratio with the revenue for deducting your input tax, again none of BT's business. Just pay the bills and they shouldn't have a problem.


  • #3
    Naked Giant
    Closed Accounts Posts: 4 ✭Naked Giant


    I understand quite well what VAT is but as you said yourself it should be none of BT's business what my VAT situaiton is. I'll report back when I change over and/or if they mentioned it again.


  • #4
    mkdon05
    Registered Users Posts: 766 ✭✭✭mkdon05


    Just be careful when claiming the vat back on the likes of home phone bills, or electricity bills on your home because if you decide to sell your house you will be entering the territory of capital gains tax which will cost you a lot more than the few euro you save on your vat bill.


  • #5
    smcgiff
    Closed Accounts Posts: 5,943 ✭✭✭smcgiff


    mkdon05 wrote:
    Just be careful when claiming the vat back on the likes of home phone bills, or electricity bills on your home because if you decide to sell your house you will be entering the territory of capital gains tax which will cost you a lot more than the few euro you save on your vat bill.

    Not sure how official this is, but a Revenue employee once told me that they would not consider apportionment of Electricity & heating, and Phone etc to affect PPR.

    However, if you claimed part of you mortgage then that would affect PPR.

    Best to get this confirmed yourselves though.


  • #6
    eggie
    Closed Accounts Posts: 880 ✭✭✭eggie


    Its probable that the BT rep you were speaking to is certainly no expert on VAT, and merely trying to dupe you into remaining on a higher tariff.

    If using phone, elec, etc for both home and business, you can simply agree with the revernue on a go forward basis which percentage relates to home and which to business use.

    The percentage which is used wholly and exclusively for the business is then deductible as input tax, assuming they can be differentiated and verified.


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