Home saved seed Charged VAT on Royalties but no VAT on cleaning and dressing??

[farmerm]

Looking at our seed cleaning/seed dressing invoice... ( for seed that is going to have to sit in the shed for a year )

Have been charged VAT on BSPB Royalties but have not been charged VAT on the seed dressing and cleaning? Can anyone explain that one or have my seed cleaners fudged up the invoice

 

[Bramble]

VAT charged by ours. Maybe your cleaners aren’t VAT registered?

 

[farmerm]

VAT charged by ours. Maybe your cleaners aren’t VAT registered?

They most certainly are... I think it must be a mistake, will give them a call.

 

[farmerm]

Well I am none the wiser... spoke to their accounts department and the lady seems happy they have not charged VAT on seed cleaning/dressing but is unsure why... I haven't been charged VAT and I haven't claimed tried to reclaim VAT so as far as I am concerned if the seed cleaners VAT position is wrong that is their lookout not mine..

 

[Barleymow]

theres no vat on bought in seed , that's been cleaned and treated

 

[neilo]

theres no vat on bought in seed , that's been cleaned and treated

True, but the actual dressing of your own seed must surely be a ‘service’, so attracting vat?

 

[farmerm]

True, but the actual dressing of your own seed must surely be a ‘service’, so attracting vat?

Ah, found this...

https://www.gov.uk/hmrc-internal-manuals/vat-food/vfood3580


"Seeds that undergo a treatment or process

Since 1st January 1996, the application of a treatment or process to another person’s goods (so as to produce new goods) is a supply of services, the liability of which follows that of the resulting goods. This change in the law does not affect the liability of the end product: it only affects whether the treatment or process is a supply of goods (pre 1st January 1996) or a supply of services. Paragraph 2 of Schedule 4, that provided for the treatment or process to be a supply of goods, has now been omitted, but still applies to supplies made before 1st January 1996.
The drying, cleaning and dressing of zero-rated seeds is now regarded as a zero-rated supply of services. The rolling and grinding of the same seed is also zero-rated. The supply of seeds coated with insecticides and/or fertiliser is a single supply (the supply being essentially one of seeds) and follows the liability of the particular seed.
the drying of grain only is not a treatment or a process producing new goods and is therefore a standard-rated supply of services."

So cleaning or cleaning and treating grain is zero rated as the resulting product is seed which is zero rated... So the invoice was correct...

If a contractor provides the service of processing my field of standing cereal crop into zero rated products of feed wheat and straw then surely by this same logic combining should be a zero rated service... Baling too as it is the service of processing a swath of straw into bales of straw

Also a VAT registered contractor providing a firewood processing service should by this logic charge VAT at 5% not 20% on the service of processing timber into firewood



Vat is a bloody mine field

 

[neilo]

Ah, found this...
https://www.gov.uk/hmrc-internal-manuals/vat-food/vfood3580


"Seeds that undergo a treatment or process

Since 1st January 1996, the application of a treatment or process to another person’s goods (so as to produce new goods) is a supply of services, the liability of which follows that of the resulting goods. This change in the law does not affect the liability of the end product: it only affects whether the treatment or process is a supply of goods (pre 1st January 1996) or a supply of services. Paragraph 2 of Schedule 4, that provided for the treatment or process to be a supply of goods, has now been omitted, but still applies to supplies made before 1st January 1996.
The drying, cleaning and dressing of zero-rated seeds is now regarded as a zero-rated supply of services. The rolling and grinding of the same seed is also zero-rated. The supply of seeds coated with insecticides and/or fertiliser is a single supply (the supply being essentially one of seeds) and follows the liability of the particular seed.
the drying of grain only is not a treatment or a process producing new goods and is therefore a standard-rated supply of services."

So cleaning or cleaning and treating grain is zero rated as the resulting product is seed which is zero rated... So the invoice was correct...

If a contractor provides the service of processing my field of standing cereal crop into zero rated products of feed wheat and straw then surely by this same logic combining should be a zero rated service... Baling too as it is the service of processing a swath of straw into bales of straw

Also a VAT registered contractor providing a firewood processing service should by this logic charge VAT at 5% not 20% on the service of processing timber into firewood



Vat is a bloody mine field

On the same basis, should bull semen be zero rated, as it is used to create livestock, a zero rated 'product' (that'll wind the vegan eejit up again.)?

 

[Hindsight]

Is a Jaffa Cake a cake or a biscuit. And the implications for VAT.

 

[farmerm]

On the same basis, should bull semen be zero rated, as it is used to create livestock, a zero rated 'product' (that'll wind the vegan eejit up again.)?

Not only should the semen be zero rated but so should the AI service and indeed all veterinary services for animals destined for the food chain...

 

[Clive]

Looking at our seed cleaning/seed dressing invoice... ( for seed that is going to have to sit in the shed for a year )

Have been charged VAT on BSPB Royalties but have not been charged VAT on the seed dressing and cleaning? Can anyone explain that one or have my seed cleaners fudged up the invoice

next time tell the seed cleavers you will pay the royalty yourself

you only have to declare it in January iirc so this year you would not have anything to pay if you don’t drill it

 

[Goweresque]

next time tell the seed cleavers you will pay the royalty yourself

you only have to declare it in January iirc so this year you would not have anything to pay if you don’t drill it

The form I have on my desk from the BSPB says responses by 19th December, for the sowing period 1st May to 15th November. So presumably if you've mauled in some seed after 15th Nov you won't have to declare it until next June........

 

[Clive]

The form I have on my desk from the BSPB says responses by 19th December, for the sowing period 1st May to 15th November. So presumably if you've mauled in some seed after 15th Nov you won't have to declare it until next June........

my declaration tends to get done early Jan when I usually get a reminder email from them