Don't do this.
I have been told this morning by a colleague that they have purchased ciomputer through a school (at a discounted price) and are paying the school back - making use of the school discount - which is a lot more than the personal educational/teacher discount they would otherwise get.
They are saving a packet.
I've always been told that we cannot do this and that it is against some sort of rule.
Can anyone confirm? Is it allowed in your school as long as the school get their money back?
Don't do this.
I thought it wasn't allowed as it circumvents VAT?
'Don't do this' - good advice - but why? Why do you say that? What rule is it? Where is it written? The school in question have told them that it's being used for school work so why not take advantage?
It depends on the schools policys probably, aslong as a full and correct paper-trail is generated with full invoices and reciepts filled in
If the school purchases something which is later sold on they have to pay the vat portion to hmrc that is all legal.
However allowing staff to do so creates more of an admin burden on the finance staff which is why most schools do not allow it.
I've previously heard of members of an IT department doing deals with a supplier to recieve the educational discount applied to a batch of 'for school' laptops, to purchase laptops for personal use. They then paid for them directly to the supplier with the VAT portion and seperate invoices to keep it all legit, but then were delivered as one consignement thus saving delivery. The only problem with doing this is that they had to have exactly the same machines as the school!
We checked this out with the Inland revenue via the local authority because students are allowed to buy musical instruments through he school and avoid VAT.
Even if the computer is to be used 100% for work or buy a student for educational purposes it cannot be purchased by an individual through the school.
This was an email from our finance team to a parent who wanted to buy through the school:
I have a quotation and order requisition for two laptops and software. I spoke to X about widening this scheme for other parents. As she was unsure about where we stand with VAT she checked it with County. County say we cannot reclaim VAT on laptops as they do not meet the criteria. Unbelievably the inland revenue does not consider laptops to be "closely related to the non-business provision of education".
If you want to pick up the order requisition you can order through our reseller using your own credit card - you still benefit from the educational pricing, but will need to pay the VAT.
It may not actually be purchased through the school itself. By this I mean that our supplier, Insight UK have allowed any staff member of the school to purchase from them as a personal customer but still get the usual discount the school would get but with VAT added. If that makes sense.
Just in case it doesn't, here's an example:
Regular Supplier Price of an item: £100 Ex Vat
Discounted Supplierprice: £80 Ex vat
Personal Purchase from Supplier using discount would be: £80 +20% (VAT) = £96
You're entering a world of pain if you go down this route.
what about if your school already pays VAT?
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