Calling all UK Adword advertisers!! AdWords VAT UK Refund??

[Kayz]

I was hoping some of my fellow Brits can help me with this one.. Well today Adwords UK sent me an email saying im eligble for an entire VAT refund that ive paid??

I dont understand, i have no business and do not own any businesses. They say that my account had the wrong VAT (which was set to personal) and they have deemed me as a business which requires me to pay business VAT which they dont handle. I am required to input my own VAT details and they will refund me all the VAT they have charged me?

Does this mean i can get my VAT back and then just sit on my arse not bother about putting my VAT code in as google have said that it is up to me whether i want to put in my correct VAT code in or not. They also say that my account will not become "reactivated or inactived" as a result of the switch they made on my behalf.

So i have a few options here... i can get some money back and not pay VAT at all if i submit a "supposidly" business name..? (which is unethical)

Then again the tax man could be on my case... even if he does i can prove to him that i have no business and he will see that for himself. So this is a google adwords mistake?

I spend $10 a month on advertising a forum thats all. Petty pocket money... and they switched my VAT into a business code...

Im thinking right now.

1. Do i take my money back and sit back not having to pay VAT as Google have said it is entirely up to me.

2. If anything does happen or if the tax man gets on my case i can show him i have had no business at all.

I see both options as a winner but im worried incase theres something i dont know... and i could get done for good....? They also say....

" It is not a requirement for you to enter a VAT ID in your
account. However, we recommend you do, so that the ID will appear
on future invoices issued to you by Google Ireland Limited. "

Anybody advise me further?? What should i do?


Below is the email Google Adwords email which was sent to me.




--------------------------------------------------------------------------
Dear AdWords Advertiser,

We'd like to inform you of an important change to how VAT impacts
your AdWords account.

I. What has changed?

We recently reviewed your AdWords account to make sure that its
VAT setting is correct. It was indicated previously either that
your account was intended for non-business purposes or you have
not entered a VAT ID. We therefore have assessed VAT at the Irish
standard rate (currently 21%) and added this amount to your
AdWords charges. During our review, we determined that your VAT
setting was incorrect. Your AdWords account is, in fact, used for
business purposes. This means that it is used to gain an economic
advantage by promoting goods or services on Google AdWords. Note
that the vast majority of advertisers use AdWords for business
purposes, including corporates, affiliates, sole traders,
self-employed merchants, partnerships, etc.

II. How has this affected me?

As a result of this discovery, we have switched your VAT setting
and will no longer add Irish VAT to your AdWords charges. You are
now responsible for self-assessing VAT at your country's local
rate (Ref: article 194 of Council Directive 2006/112/EC).

We will switch an AdWords account's VAT setting whenever a review
finds that the setting is incorrect. This is true even if your
AdWords account is inactive. (Rest assured that the switch will
not reactivate an inactive account.) Please note that Google
AdWords cannot provide advertisers with VAT advice. For general
information about VAT rates, self-assessing VAT or receiving
services for a business purpose, we recommend consulting your
local tax office.


III. What should I do now?

You may be eligible for a refund of Irish VAT charged by Google
Ireland Ltd. Please sign in to your AdWords account and update
your VAT information per the instructions at
https://adwords.google.com/support/b...=6398&hl=en_GB.
This will alert our system to check for refund eligibility as well
as ensure that we have the correct address for any refund that we
issue. When updating your VAT information, you will need to ensure
that you have correctly completed the 'Company Name' field:

- Your account's 'Company Name' field is located on your 'Billing
Preferences' page, under 'VAT Information > Business Address.'

- Make sure that the name in this field matches the name on your
bank account.

- If you only have a bank account in your own name you can enter
your own name in the 'Company Name' field.

- It is not a requirement for you to enter a VAT ID in your
account. However, we recommend you do, so that the ID will appear
on future invoices issued to you by Google Ireland Limited.

It's important that you follow these instructions, since any
refund cheque you receive will be made out to whatever you enter
under 'Company name.' You will only be able to deposit this cheque
in a bank account held in the same name. If you are unable to
deposit your refund cheque it may take us up to three months to
issue you with a new one. Please be sure to update your account
shortly per the instructions above. If you are eligible for a VAT
refund but do not update your account, we will send your refund
cheque to your account's billing address:

[hasen]

If you aren't liable to pay VAT ie you're annual turnover is less than £67000 then you can just leave it blank so it won't affect you. Just follow the steps in the email to set up your account, its self explanatory once you're in there.

[Kayz]

Originally Posted by hasen

If you aren't liable to pay VAT ie you're annual turnover is less than £67000 then you can just leave it blank so it won't affect you. Just follow the steps in the email to set up your account, its self explanatory once you're in there.

I see, so it wont be a big deal if i dont pay VAT at all?

[Sem-Advance]

Originally Posted by Kayz

I see, so it wont be a big deal if i dont pay VAT at all?

Unless someone is offering to pay your taxes if they are wrong.... this is the wrong place to seek guidance.

I would say though grab your money slap it in the bank earn interest and then use the money saved to help pay your taxes when due.

[hasen]

You don't have to pay VAT unless your company is VAT registered. If you earn more than £67000 per year then you HAVE to become VAT registered. You can become VAT registered voluntarily however but if none of this applies to you then VAT does not affect you.

[Kayz]

Originally Posted by hasen

You don't have to pay VAT unless your company is VAT registered. If you earn more than £67000 per year then you HAVE to become VAT registered. You can become VAT registered voluntarily however but if none of this applies to you then VAT does not affect you.

Cheers for that..., i think i will get my money back and do a runner!! Are you a UKian by the way?

[hasen]

Originally Posted by Kayz

Cheers for that..., i think i will get my money back and do a runner!! Are you a UKian by the way?

Yes I am indeed a 'UKian' although I can't confess to having heard that term before.

[Kayz]

Originally Posted by hasen

Yes I am indeed a 'UKian' although I can't confess to having heard that term before.

lol i know i made it up! its DP afterall

[rushy]

To claim your VAT back from Google, you will need to be a VAT registered company. To claim VAT back you do not need to have a turnover above £67000, you can claim VAT back on anything as long as you are VAT registered. The problem with registering for VAT however, is that you will have to PAY and CHARGE VAT on all your services. For example, if you offer web design for £100 - without VAT you would simply charge £100. Once you are VAT registered, you need to charge £100 + VAT (£117.50) to your client. They can then claim that back through the VAT system. The VAT element you have just charged (£17.50) you will have to pay to the taxman when your VAT return is due (every 3 months).

However, if you bought something from a VAT registered comapny for £100 + VAT (£117.50) and sold something for £100 + VAT (£117.50), you would not have to pay anything because you can claim the first £17.50 back, but will have to pay the second £17.50, therefore meaning that they cancel each other out and at the end of your 3 month period, you would have nothing to pay and nothing to claim.

This is a very simplified explanation. When you throw in over 50 transactions all different the VAT element you need to pay and claim is harder to work out, this is why you need a good accounting software which calculates all of this for you - I have used SAGE Line 50 for this in the past....

Hope that helps,

[Kayz]

Originally Posted by rushy

To claim your VAT back from Google, you will need to be a VAT registered company. To claim VAT back you do not need to have a turnover above £67000, you can claim VAT back on anything as long as you are VAT registered. The problem with registering for VAT however, is that you will have to PAY and CHARGE VAT on all your services. For example, if you offer web design for £100 - without VAT you would simply charge £100. Once you are VAT registered, you need to charge £100 + VAT (£117.50) to your client. They can then claim that back through the VAT system. The VAT element you have just charged (£17.50) you will have to pay to the taxman when your VAT return is due (every 3 months).

Hope that helps,

Cheers for that Rushy, google are willing to send out a Cheque to me with my name on it as theyve explained to me in their email. So does this mean i will still need a VAT registered company to deposit the money or can i still deposit the cheque in my normal personal account?

Cheers