VAT Increases and Exempt Businesses.

The Standard rate of Value Added Tax (VAT) rose today from 17.5% to 20%.

In line with curent legislation, there are two rates of VAT applicable to the supplies of electricity and gas used for business and non domestic purposes.

• Standard rate
• Reduced rate

Where an electricity or gas supply is used wholly or partially for domestic or charitable non-business use, that part of the supply qualifies for the reduced rate of VAT. This is known as 'qualifying use.'

Examples of businesses which can qualify for reduced rate VAT on the ground of domestic use include

• Self-containned duelling such as houses or flats (applicable to pubs)
• Job-related accomodation (vicarages, manse etc)
• Monastry, nunnery or similar
• Residential accodation for Armed Forces
• Residential Homes for children, old people etc
• Hospice or palliative care
• Caravan parks / holiday accomodation
• Shower blocks
• Staff accomodation in hotels etc
• Residential accomodation in school
• Ancillary rooms used by boarders
• Landlord supplies

In addition to the domestic usage as listed above, certain other types of supply are considered to be non-business usage and charged at the reduced rate

• Charities
• Churches and other places of worship
• Village halls / community centres / leisure centres etc
• Educational establishments

Within each catorgory there are rules governing what activities are governed by the regulations, not all businesses will qualify and it is also possible to have mixed usage where a proportion of the energy bill is charged 20% for VAT and the rest is charged at 5%.

It is very important for anyone running a business or commercial or charitable activity, as listed abot to consult their accountant for advice or FREE ADVICE can be given on this subject by calling John at Phoenix Energy on 07974 387 218 or 0800 458 64 60

Now that the VAT rate has changed it is more important than ever to ensure that your organisation is paying the correct rate, particularly if you do not have provision to reclaim VAT.

All businessses using less than 12000 kWh / annum of electricity or 73200 kWh /annum currently pay rate at the reduced rate.

New Year's Resolution Anyone?

Happy New Year to Phoenix Energy customers old and new.



A new year is often the time for people to make New Year's Resolutions - lose some weight, stop smoking, get fit - but probably the most common resolution is to save money! Most of the big 6 energy suppliers, and a few small ones, have recently treated us to a round of pre-Xmas festive price rises - very seasonal of them! Combined with the worst December weather for 120 years mean that millions of people will get nasty suprises when the electricity / gas bills arrive on doormats shortly!



Phoenix Energy offer our domestic customers a way to cut their energy bills. It is probable that anyone who has never switched, would be able to pay even less money than last year, despite the price hikes. We offer a range of fixed, capped, internet only, green energy and pre-payment deals to suit every customer, however large or small their bill and however the customer wishes to pay. Our domestic site is called GET ME CHEAP BILLS . COM and can be accessed via this link



http://www.getmecheapbills.com/



For business customers, without the price protections afforded to domestic customers, the price rises have been much more steep. Another effect of the business market is that many businesses sign long energy contracts of 3-5 years and anyone coming off a fixed contract in the last year will have had to renew at a significantly higher price than previously obtained.








The graph above shows wholesale gas costs, which is one of the main factors affecting energy prices.


I have tabulated below the typical aquisation tariff for one of the leading energy suppliers for a typical small business customer over the last year.


March 2011 - 10.69p
December 2010 - 10.45p
October 2010 - 10.35p
July 2010 - 8.70p
April 2010 - 8.78p
December 2009 - 8.92p


There are many types of business electricity meters and different rates across the country, and sometimes a supplier is more competitively priced at certain periods of the year but the overall price rise is 16.5% between the dates shown, (with a small decrease in the summer) follows the market trend and should be indicative of future energy costs.


Phoenix Energy offer a range of different suppliers and also different tariff lengths to meet the needs of all UK businesses.


To obtain a no - obligation price quote, for up to 120 days ahead please call 0800 458 6460


Please also use this number for any other queries or information.


If your contract is not due to expire yet please contain us for details of how we can help you with your energy renewals and to ensure that you handle the termination process correctly to avoid being 'rolled over'. We offer a free of charge service to our customers and can contact your supplier on your behalf to facilitate a trouble free transfer.