charging 20% VAT for domestic-use firewood - advice?

[Huge]

I continue to be astonished that anyone pays VAT on firewood at all.

[Dave Liquorice]

In this context it's "domestic fuel" so attracts VAT at 5% just like domestic oil, gas and electricity. Fairly sure that 5% VAT on domestic fuel is a UK thing, if the EU had their way it would be standard rate -

20%.

[Dave Liquorice]

Which is?

Is a lump wood 18 x 4 x 4" "firewood"?

[Fredxx]

If you have a hearth 18" wide or deep, I don't see why not!

[Steve Firth]

No, you are wrong. You are misinterpreting VAT Notice 701/19 (August 2012). Section 7.1.2 makes it clear that supply of any wood (without limit on length, split, or other characteristic) is eligible for the reduced rate if held out for sale solely as fuel, provided that the customer does not intend to resell it. This applies regardless of the amount supplied. Unlike the claims you have made here the intent of the customer is a necessary condition for the reduced rate.

Section 7.1.3 you appear to be cometely misinterpreting since it does not define what firewood is. What it says is that even if wood is prepared by cutting and splitting it is standard rated unless held out for sale as fuel. It does not over rule 7.1.2.

[Steve Firth]

He's just plain wrong. There's no requirement for the wood to be cut and split to a particular size.

[harry]

I continue to be surprised that people pay for firewood. There are tiny bags in our B&Q for a ridiculous price.

BTW, Why are Churchill insurance slime?

[Huge]

My point was that firewood is generally sold by grubby little men without enough teeth, for cash, and VAT never enters into it.

[Dave Liquorice]

Any body buying firewood other than for a fire used occasionally, as an ornament, doesn't buy it in those tiny bags. Our stove would get through

3 or 4 of those an evening...

[Jeff]

Correct

The rules do not state that, merely that it must be held out as firewood, and the purchaser must not re-sell it. There is no rule that the wood must be pre-cut or split, or that the purchaser may have to do that himself, as long as the intention of the seller is that the wood is purely for firewood.

Jeff

[Tim Streater]

The little man that sells us our wood is not grubby and I have never examined his teeth. He lives across the field from us. I pay by cheque and he gives me a receipt.

[Steve Firth]

The only rule on the form of the wood is that it mustn't be prepared for use as constructional timber. However if it is constructional timber then cutting it into short lengths and offering it for sale as firewood means it can be sold at reduced rate VAT. That seems to be the section that is confusing Mr Heney.

[Fredxx]

Perhaps the rest of Europe are more sensitive to the near indiscriminate burning of fossil fuels for domestic use.

[Steve Firth]

A good rant spoiled only by the facts. VAT on fossil fuel in Italy is 10%. VAT on firewood is zero.

[Alex Heney]

The rules also say "and that this is consistent with the packaging and wrapping in which you supply it."

I regard that as meaning that it must be in a suitable state for use as firewood.

And I would also expect the sellers to err on the side of caution there too. They will not likely be done by HMRC for charging 20% VAT on wood they are selling. It is much more likely they would be done for selling it with 5% VAT if it didn't meet the expectations of the inspector.

[Alex Heney]

Nope.

That section is irrelevant to this discussion.

[Alex Heney]

To me,. that implies that they must be sold in a state suitable for use as firewood.

I don't see why the packaging being plain would make any difference.

If some of the logs are unsplit and too big for use on any normal domestic fire without splitting, then I would think those should not really have been sold as firewood qualifying for the reduced rate.

[Alex Heney]

>>>>>>> Within that, sections 7.1.2 & 7.1.3 are the relevant ones here: >>>>

True.

It is definitely open to interpretation.

But I would expect most VAT registered businesses to err on the side of caution here, as I said in another post.

I certainly don't think it is clearly "wrong" to charge 20% on logs that aren't actually in a state suitable for domestic fires without further preparation.

[Alex Heney]

I would say so, provided it was also advertised as such.

You are probably getting close to the upper limit there, but I wouldn't like to say exactly where that might be set.

You have to use your common sense.

[Alex Heney]

I will accept it is open to interpretation.

I won't accept just "plain wrong" unless you can come up with some good evidence beyond your interpretation.

I've never said there is.