# Purchase of new Motorhome



## AlanBudgie (Nov 22, 2010)

I ordered a new motorhome and paid a deposit on 31/10/10 I was give an On The Road Price of £37995 for collection on 01/03/11 payment due 3 days before collection. 

I have now been informed that if I don't pay the full balance by the 04/01/11 I will have to pay the extra 2.5% VAT. Which of course I don't want to because it would mean leaving the vehicle with them till the new reg. comes out in March along with £37995 during which time anything could happen.

The other option they gave me was pay for the MH in full on 04/01/11 and they would deliver the motorhome to my house and then register the MH in March on the 11 plate. , but I can't get insurance for more the 2 weeks on a chassis number only. 

It is to risky to leave the MH on the drive with out insurance for 2 months so I have asked for the return of my deposit to which they have refused.

I feel they have broken the contract by asking me to pay for the vehicle 2 months early or pay the extra VAT. none of which was stated at the time the order was made when of course they already knew of the VAT increase.

Any comments on what you think I can do please. 

Thanks Alan


----------



## geraldandannie (Jun 4, 2006)

I'm surprised they didn't mention the increased VAT rate at the time of ordering. Did you ask?

But I would have thought, _from the information you've posted_, that they have broken the contract by changing the conditions, and should refund your deposit.

Gerald


----------



## MikeCo (Jan 26, 2008)

I presume that you also knew about the VAT increase as well so I wonder who you thought would pay it.

If the motorhome is available have it now and use it and don't worry about the 2011 plate.

Mike


----------



## rayc (Jun 3, 2008)

Quote: "I have now been informed that if I don't pay the full balance by the 04/01/11 I will have to pay the extra 2.5% VAT. Which of course I don't want to because it would mean leaving the vehicle with them till the new reg. comes out in March along with £37995 during which time anything could happen. 

The other option they gave me was pay for the MH in full on 04/01/11 and they would deliver the motorhome to my house and then register the MH in March on the 11 plate. , but I can't get insurance for more the 2 weeks on a chassis number only". end quote:

Are you saying that the MH will be ready for delivery by 4th January but you have asked them to delay it so that you can have a 11 reg?

If so and if it were me I would pay my money and take it with the current 60 registration. 2.5% saving has got to be worth an 'older" number and would pay for a private plate if it worries you. 

In any event neither of your options above would leave me with a comfortable feeling. 

Ray


----------



## JohnsCrossMotorHomes (Jul 21, 2007)

If the order form clearly states an on the road price, which will include Road Tax, delivery charges and VAT with a delivery date as 01/03/2011 then this is a written contract.

If the van is physically in stock at the dealer, there is nothing to stop them invoicing the van on 04/01/2011 and waiting for payment as per the agreed date on the order, this is perfectly legal.

The disadvantage to the dealer is that he will have to pay the VAT in that quarter, but the he has had your deposit for four months.

I can only say that if we agreed in writing the above terms, we would abide by them.

Peter


----------



## tony645 (Sep 26, 2010)

ok, so we`re talking about £780 here! If you dont want it until march then why not pay it or come to some deal with a couple of extras, when you take off the expense of the insurance plus your new plate, seems like a small amount towards the £37995. Surely you knew about the vat increase?


----------



## AlanBudgie (Nov 22, 2010)

I said to the salesman while being shown round the MH I didn't know whether to purchase a MH now or in March with 11 plate to which he replied order it now pay the deposit collect it on the 01/03/11 and you have got it at todays price with out paying the extra VAT. 
He as turned around today and said thats how he understood the situation to be, put he as now been told by VAT man that all MHs must be invoiced by 04/01/11 or an extra 2.5% VAT be charged. 
Thanks Alan


----------



## nidge1 (Jul 26, 2009)

*Re: Purchase of new Motor home*



AlanBudgie said:


> I ordered a new motorhome and paid a deposit on 31/10/10 I was give an On The Road Price of £37995 for collection on 01/03/11 payment due 3 days before collection.
> 
> I have now been informed that if I don't pay the full balance by the 04/01/11 I will have to pay the extra 2.5% VAT. Which of course I don't want to because it would mean leaving the vehicle with them till the new reg. comes out in March along with £37995 during which time anything could happen.
> 
> ...


 

Hi Alan,

Not sure which is the best way forward for you but I hope this may help.

I have also ordered a new MH at the recent NEC show and paid a small deposit.The dealer said the MH would be delivered around the end of March on a 11 plate. He has kept us informed of everything as we have added some extras.

Today I have received the following letter from him ----- Dear Sir, We have been informed by the VAT office that we can invoice you for your vechicle before 31st December 2010 and as long as the vechicle is collected and monies paid in full any time up to six months after, it can remain at 17.5% VAT. Any extras or alterations after 31st December 2010 will be invoiced at the increased amount.

Regards

Nidge


----------



## Addie (Aug 5, 2008)

AlanBudgie said:


> I have now been informed that if I don't pay the full balance by the 04/01/11 I will have to pay the extra 2.5% VAT.


A lot of people ordered vehicles at the NEC show, left a deposit and have since pulled out (I know of at least 4).

I think dealers are getting edgy and are asking for full payment and using the VAT argument as an angle.

I very nearly bought a van at the show myself but saw sense and the dealer has been writing to me saying that they can only honor the VAT if I place an order before the end of this week. Not to worry, if I change my mind another dealer will honor the price right upto 31st December


----------



## JohnsCrossMotorHomes (Jul 21, 2007)

*Re: Purchase of new Motor home*



nidge1 said:


> Today I have received the following letter from him ----- Dear Sir, We have been informed by the VAT office that we can invoice you for your vechicle before 31st December 2010 and as long as the vechicle is collected and monies paid in full any time up to six months after, it can remain at 17.5% VAT. Any extras or alterations after 31st December 2010 will be invoiced at the increased amount.
> 
> Regards
> 
> Nidge


As far as I am aware that if the vehicle is not physicsally present and in the dealers stock at the time of invoicing and it is not the normal business practice of the supplier, *HMRC will treat this as tax evasion.*

The advice issued is a catch 22 situation, HMRC win whatever you do, personally I invoice at the point of delivery with a nett price to the customer as agreed on the order and pay any extra VAT myself.

Brave man, your dealer, I would not do it!

Peter


----------



## Addie (Aug 5, 2008)

Dealers were using the 2.5% rise as an incetive to buy at the show (and lordy me it worked) but details on paying the balance differed - but the dealers I spoke to were happy to honor the rate for a delivery and payment of balance in March.

How the dealers balance their books is upto them, but when the salesman took a deposit (non-refundable of course) he probably did so under the standard terms of sale. If these were in writing then he can't go back on these because he misunderstood the implications of the VAT rise.

Given the amount of motor vehicle dealers going bump in recent years, I certainly would not want to pay in full before the van was delivered.


----------



## bognormike (May 10, 2005)

*Re: Purchase of new Motor home*



nidge1 said:


> AlanBudgie said:
> 
> 
> > I ordered a new motorhome and paid a deposit on 31/10/10 I was give an On The Road Price of £37995 for collection on 01/03/11 payment due 3 days before collection.
> ...


I know Peter (Johns Cross) has replied to this implying it's a bit iffy, but this provision is actually in the guide issued by HMRC to traders - see attached page 8. point 2.6

http://www.hmrc.gov.uk/vat/forms-rates/rates/rate-rise-guidance.pdf#page=8

it quotes the example of a deposit before the change with a balance payment after it, and a full payment up front - where that payment is made in full up front it can be treated as a sale at the date of payment - the rules do not specify that the goods in question have to be in stock.


----------



## AlanBudgie (Nov 22, 2010)

JohnsCrossMotorHomes said:


> If the order form clearly states an on the road price, which will include Road Tax, delivery charges and VAT with a delivery date as 01/03/2011 then this is a written contract.
> 
> If the van is physically in stock at the dealer, there is nothing to stop them invoicing the van on 04/01/2011 and waiting for payment as per the agreed date on the order, this is perfectly legal.
> 
> ...


I have spoken with the sale person this morning he just keeps saying the same thing they haven't increased the price of the MH I just have to pay the full balance before 04/01/2011. Is it right they hold the MH paid for in full I don't think saw. Would it be insured their order form states I'm responsible for the MH as soon as the sale is complete.
Alan


----------



## DSL2 (Mar 6, 2008)

Maybe helpful if you end up having it delivered pre Xmas!

I struggled to insure whilst waiting for the new reg to come around having had the motorhome delivered some three months earlier. No one would cover it sat on the drive without a registration number issued. However I insured my race cars which have no reg numbers with a company called OMPS special risks (0207 2563602) who where happy to cover it for £120k whilst sat on the drive for not a lot of money (circa £160 from memory)


----------



## DSL2 (Mar 6, 2008)

Maybe helpful if you end up having it delivered pre Xmas!

I struggled to insure whilst waiting for the new reg to come around having had the motorhome delivered some three months earlier. No one would cover it sat on the drive without a registration number issued. However I insured my race cars which have no reg numbers with a company called OMPS special risks (0207 2563602) who where happy to cover it for £120k whilst sat on the drive for not a lot of money (circa £160 from memory)


----------



## rayc (Jun 3, 2008)

DSL2 said:


> I struggled to insure whilst waiting for the new reg to come around having had the motorhome delivered some three months earlier.


Is a new reg that important now that it changes twice a year? I have a 2008 manufactured MH registered on a 09 plate. What difference, if any, will it make on trade in time?


----------



## cabby (May 14, 2005)

What I cannot understand, if the vehicle is in stock and not a factory order, there is no reason NOT to give a refund of the deposit.
However if you are set on having this vehicle I would pay on collection of the vehicle the extra VAT, definately would not part with that sort of money before hand over.
I notice that you have not mentioned who the dealer is. :roll: :roll: 

cabby


----------



## AlanBudgie (Nov 22, 2010)

cabby said:


> What I cannot understand, if the vehicle is in stock and not a factory order, there is no reason NOT to give a refund of the deposit.
> However if you are set on having this vehicle I would pay on collection of the vehicle the extra VAT, definately would not part with that sort of money before hand over.
> I notice that you have not mentioned who the dealer is. :roll: :roll:
> 
> cabby


I think there are a lot of dealers struggling for cash maybe that's the reason. 
 Alan


----------



## Scolds (Jul 26, 2010)

No one has answered the question about having it sat on your driveway uninsured, maybe as it is not a wise decision. I read in another post one chap saying some youths torched his van outside his house. I guess that answers the question.

Is the real reason wanting it next year because you don't see yourself using it until then? I think the plate issue after 5 years won't matter on selling it.


----------



## scouter (Dec 14, 2007)

I remember from my work days, when items purchased were stored at the manufacturers and not delivered when they were ready although paid for, they were clearly marked up as being the property of my company. 

This stemmed from some case law, "Rylands & Fletcher" springs to min but thats probably something else. 

Anyway it meant that if the supplier ceased to trade, the goods were ours and not part of the company's stock! But the goods had to be there to be marked up. 

However I wouldn't want to part with nearly £40k for 3 months for the sake of a later plate but then we tend to keep our vans for 5 to 10 years usually and have only bought 1 new, which is another story 

alan


----------



## iandsm (May 18, 2007)

*VAT*

Just the answer I expected from JC. Although I have not purchased from them, I fully intend to when the time comes, not least because of their reputation and the way they answer questions on here.

I think you should name your dealer as whoever it is they do not seem to have your interests as a first priority!


----------



## rosalan (Aug 24, 2009)

It strikes me that goodwill is not their first consideration. Their 'mark-up' for selling a new vehicle, could I feel sure cover their loss at the V.A.T. end, when balanced against your potential future servicing custom, to say nothing of any extras you may have considered. However I think they may have already blown away much goodwill by their stance. I too feel that they should have honoured their salesman's deal, so would be interested to know who to avoid in future.
I know it may be a wild shot but does your local radio have a consumers programme? If they do, there could be bargaining possibilities where poor trading deals get wide enough publicity to bend their elbow.
Alan


----------



## AlanBudgie (Nov 22, 2010)

Scolds said:


> No one has answered the question about having it sat on your driveway uninsured, maybe as it is not a wise decision. I read in another post one chap saying some youths torched his van outside his house. I guess that answers the question.
> 
> Is the real reason wanting it next year because you don't see yourself using it until then? I think the plate issue after 5 years won't matter on selling it.


 Yes it would be sat on the drive till next spring not being used, the original deal suited me fine because the MH was locked away inside, the money in the bank, and it wasn't costing me anything.

Alan


----------



## nidge1 (Jul 26, 2009)

*Re: Purchase of new Motor home*



JohnsCrossMotorHomes said:


> nidge1 said:
> 
> 
> > Today I have received the following letter from him ----- Dear Sir, We have been informed by the VAT office that we can invoice you for your vechicle before 31st December 2010 and as long as the vechicle is collected and monies paid in full any time up to six months after, it can remain at 17.5% VAT. Any extras or alterations after 31st December 2010 will be invoiced at the increased amount.
> ...


Hi Peter,
Thanks for your reply. The dealership in question is a long standing reputable company and I can only quote the letter I received from him, he is not asking for the the full invoice to be paid up front and presumably he has taken advice from the VAT office regarding the situation.

I shall however be contacting him to get clarification on the matter. Perhaps he is going to take the hit of the VAT I don't know if this is the case but I would be very reluctant to pay the extra VAT myself especially as I have it in writing regarding the VAT.

Regards

Nidge


----------

