-
31-05-07 #1
Registered User
- Join Date
- May 2007
- Location
- I'm a Shoreditch b*tch. Find me in Bar 1001 on Brick Lane.
- Posts
- 241
- Thanks
- 5
- Thanked 21 Times in 15 Posts
VAT on the major PPC engines
Hi, first post. My question relates to how the big PPC engines display VAT charges.
Google. As I understand it all prices on the campaign summary page are ex VAT, Google doesn't add VAT until they make out the invoice? Is this correct? Is there a way to alter the figures so they display inclusive of VAT?
MSN. I think I'm correct in saying that AdCenter doesn't charge VAT as they're not based in Europe?
Yahoo. Do YSM charge VAT? Are click prices displayed inclusive of VAT?
Thanks!
-
31-05-07 #2
Registered User
- Join Date
- Jun 2006
- Posts
- 206
- Thanks
- 3
- Thanked 15 Times in 13 Posts
Adwords are based in Ireland where it is 20+ % VAT. Therefore you can opt for adwords not to add the VAT if you choose. You must pay the tax due in the country you reside in. I have always allowed the saving to account for itself as the amount you save will form part of your profits, which will get taxed at sourced anyway in due course.
MSN do not add VAT to their bills, why this is I do not know.
Yahoo bidding prices exclude VAT, but are charged with VAT.
-
01-06-07 #3
Super Moderator
- Join Date
- Nov 2004
- Location
- On World Tour!
- Posts
- 1,330
- Thanks
- 44
- Thanked 37 Times in 28 Posts
If you are using Adwords for business purposes you don't pay any VAT. There's an option to select for this on the campaign management interface.
I'm sure others can explain the reasons why better than myself!Please Read My Affiliate Marketing Blog.
& consider joining The Affiliate Lending Team - help entrepreneurs in 3rd world countries - all the cool affiliates are doing it 
-
01-06-07 #4
Registered User
- Join Date
- Nov 2004
- Posts
- 844
- Thanks
- 8
- Thanked 5 Times in 3 Posts
If you turn over over £57k you have to register for vat, you can reclaim your vat but then you have to pay vat on your commissions. As far as I know each ltd company has a seperate threshold.
-
01-06-07 #5
Super Moderator
- Join Date
- Nov 2004
- Location
- On World Tour!
- Posts
- 1,330
- Thanks
- 44
- Thanked 37 Times in 28 Posts
Adwords does not charge VAT on accounts being used for business purposes regardless of whether you are VAT registered or not. My understanding of all this is less than clear, despite having been involved in many discussions about it!
When Adwords brought in this policy it was in response to an EU ruling on the way they were applying vat to advertising services. Once you said your account was for business purposes your vat payments were refunded. I think because you are the provider and recipient of the service the VAT element is cancelled out.
Here's a previous post made by an accountant on this issue, which is clearer than my vague ramblings: -
Please Read My Affiliate Marketing Blog.
& consider joining The Affiliate Lending Team - help entrepreneurs in 3rd world countries - all the cool affiliates are doing it 
-
01-06-07 #6
Registered User
- Join Date
- Jun 2005
- Location
- Hampshire, UK
- Posts
- 609
- Thanks
- 9
- Thanked 5 Times in 5 Posts
When I first signed up for Adwords I didn't sign up as a business and it took me a while to realise they were charging me 20% extra for the VAT
I spoke to Google about this and they asked for my company details. A few weeks later they sent me a cheque for several thousand pounds
So if anyone else is in the same situation it's worth trying to get this VAT refunded. My claim went back several months.
-
01-06-07 #7
Registered User
- Join Date
- May 2007
- Location
- I'm a Shoreditch b*tch. Find me in Bar 1001 on Brick Lane.
- Posts
- 241
- Thanks
- 5
- Thanked 21 Times in 15 Posts
I think Google's position on VAT is a tad confusing, I just read their help documents and I'm still none the wiser. We don't use PPC (yet) and the original question was actually asked for a friend who does, but only on a small scale (nothing close to 57k turnover). They're not VAT registered but are slowly building a business around their PPC efforts in the finance sector. As I understand it from Kirsty, by informing Google that you're a "business", you can avoid Google's VAT charge?
Thanks for everyone's replies, much appreciated.
-
01-06-07 #8
Merchant User
- Join Date
- Apr 2006
- Location
- Cheshire
- Posts
- 1,432
- Thanks
- 14
- Thanked 18 Times in 17 Posts
Guys, i don't get this, i've run adwords for a long time, up until January with a sole trader account, and from jaunary on with a limited company account, neither vat registered.
Does the irish vat charge adwords have applied to all my bills apply, or should i be asking for it back? I've not got the option to select 'using for business' in the account settings, it is greyed out!!!
Any help appreciated.
-
01-06-07 #9
Registered User
- Join Date
- May 2007
- Location
- I'm a Shoreditch b*tch. Find me in Bar 1001 on Brick Lane.
- Posts
- 241
- Thanks
- 5
- Thanked 21 Times in 15 Posts
I *think* you should be asking for it back assuming you've been charged at 20%, I'm going to email G and see if I can get a straight answer (ha!).
I've just checked this in Google's help pages, apparently it's not possible to change your account from non-business to business or vice versa, you need to email Google to change the setting manually.
-
02-06-07 #10
Super Moderator
- Join Date
- Nov 2004
- Location
- On World Tour!
- Posts
- 1,330
- Thanks
- 44
- Thanked 37 Times in 28 Posts
I can absolutely 100% confirm that if you're using your adwords account for your affiliate business you should not be paying the 20% VAT.
I got a VAT refund before I became VAT registered (which the effing tax man then charged me tax on!).Please Read My Affiliate Marketing Blog.
& consider joining The Affiliate Lending Team - help entrepreneurs in 3rd world countries - all the cool affiliates are doing it 
-
02-06-07 #11
Registered User
- Join Date
- May 2006
- Location
- Barnsley
- Posts
- 265
- Thanks
- 2
- Thanked 40 Times in 17 Posts
Hi,
Threshold is now £64k, but includes VATable sales and Adwords expenditure.
ie if sales are £50k & Adwords expenditure £14K you have to register for VAT. The threshold is for the preceeding 12 months or if you expect to exceed the threshold in the next 30 days sales/Adwords you will need to register. (ie £64k in the next month alone).
Adsense (and similar non UK) income is excluded from the calculation as it is out of the scope of UK VAT - but is still taxable (income or corporation tax if you are a Ltd Co.)
UK commissions - if you are VAT registered you will charge VAT, receive it from the networks and at the end of each quarter pay it to HMRC ie you will be no worse off. You can reclaim the input VAT on costs such as UK hosting, PC, software, broadband, mobile phone etc. VAT can only be reclaimed where the invoice/bill has a valid VAT number, costs such as postage (not courier services such as UPS) are exempt for VAT purposes.
If your turnover is below the VAT threshold but you have high input VAT (not usually the case for AM unless lots of UK expenditure and non-UK sourced income which is out of scope of UK VAT), you can voluntarily register for VAT and recover the input VAT.
As usual there are HMRC penalties for not registering at the correct time. Also it is illegal (ie fraudulent) to charge VAT if you are not VAT registered.
Hope this helps clarify a few points.
Keith
HRBS Limited
Small Business Specialists
hrbsonline.com - the online accounting solutionSpecialist affiliate marketing accounts/tax services - fixed fees
** Free tax saving guides at tips.hrbs.biz **
-
19-06-07 #12
Merchant User
- Join Date
- Apr 2006
- Location
- Cheshire
- Posts
- 1,432
- Thanks
- 14
- Thanked 18 Times in 17 Posts
For everyones information, my adwords campaign was being run as a personal account for about a year, i hadn't even realised. I emailed adwords to tell them to change it over, and to investigate whether i was able to claim back the VAT for the entire period of using their service as i wasn't VAT registered. They have taken about two weeks but today come back to me and confirmed that i am infact entitled to a refund and that £500 is coming to me in the form of a cheque over the next few weeks...result.
If anyone needs info on how i approached this (thx to my accountant) please let me know on here.
-
19-06-07 #13
Super Moderator
- Join Date
- Nov 2004
- Location
- On World Tour!
- Posts
- 1,330
- Thanks
- 44
- Thanked 37 Times in 28 Posts
Not only that, but all your Adwords PPC campaigns are now 20% more profitable. The drinks are on you at the next G2G!
Please Read My Affiliate Marketing Blog.
& consider joining The Affiliate Lending Team - help entrepreneurs in 3rd world countries - all the cool affiliates are doing it 
-
19-06-07 #14
Merchant User
- Join Date
- Apr 2006
- Location
- Cheshire
- Posts
- 1,432
- Thanks
- 14
- Thanked 18 Times in 17 Posts
haha, friad that money has already been spent, am vat registered from next month!
-
20-06-07 #15
Registered User
- Join Date
- Aug 2003
- Location
- Here
- Posts
- 1,377
- Thanks
- 0
- Thanked 1 Time in 1 Post
A survivor personality is a winning personality that longs to win in the long-term, within the big picture and not one that looks only to succeed within individual moments.
Thread Information
Users Browsing this Thread
There are currently 1 users browsing this thread. (0 members and 1 guests)
Similar Threads
-
Seach Engine Optimisation FAQ [Jan2006]
By thetafferboy in forum Google SEOReplies: 2Last Post: 09-01-06, 05:11 PM -
Google Vat Reclaim
By EyeOfTheTiger in forum Affiliate Marketing LoungeReplies: 0Last Post: 29-07-05, 12:56 PM -
BA & VAT - resolved once and for all?
By Flightmapping in forum Commission Junction - CJ UKReplies: 0Last Post: 07-06-05, 08:27 PM -
backdating VAT
By Flightmapping in forum Everything Financial : Funding, VAT, Taxation, StartupsReplies: 17Last Post: 29-01-04, 10:01 AM -
Money Supermarket
By pericom in forum Independent ProgramsReplies: 12Last Post: 13-09-03, 05:10 AM


LinkBack URL
About LinkBacks
Reply With Quote

Bookmarks