How many estate and letting agents quote their fees and other charges without VAT?
And how many know that they should not be doing so – for example, stating £100 + VAT?
The rule is quite clear in the CAP (Committee of Advertising Practice) code:
3.18 Quoted prices must include non-optional taxes, duties, fees and charges that apply to all or most buyers. However, VAT-exclusive prices may be given if all those to whom the price claim is clearly addressed pay no VAT or can recover VAT. Such VAT-exclusive prices must be accompanied by a prominent statement of the amount or rate of VAT payable.
Since almost all estate agency and letting agency customers are consumers, they cannot reclaim VAT.
It therefore stands to reason that agents (both the high street and online variety) should advertise fees and prices inclusive of VAT – and do so wherever they advertise, whether in print or online.
Indeed, if you don’t, you are in breach of the CAP code.
A property advertising manager for one local newspaper group tells us that he has to have constant conversations with his agent advertisers about the need to show prices that include VAT.
Eye took a random look round some agents’ websites.
eMoov, for example, quotes prices plus VAT. Hatched used to do the same, but following a brush with the Advertising Standards Authority last year on a largely unrelated matter, now quotes prices inclusive of VAT.
Sarah Beeny’s Tepilo does not include VAT. It says of its prices that they all are subject to VAT, making her a potential high-profile case for the advertising watchdog.
Purplebricks launched with a price of £599 including VAT, but has changed to a new price of £665 plus VAT.
Foxtons makes it clear that its prices include VAT, for example, stating of its charges to tenants that the usual £420 is inclusive of VAT.
Waterfords, in Hampshire, Berkshire and Surrey, goes even further. It sets out its tenancy fees in two columns, the first showing the fee without VAT and the second with VAT.
Leaders, however, quote prices plus VAT – for example, an admin charge of £275 plus VAT.
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