CD Ordering and VAT Issues

bigvern · Post by **bigvern** » Fri Jan 30, 2004 1:44 pm

Abstract from my News Page:

Following a visit by Customs and Excise this morning, I would just like to re-iterate that Trainsim UK is not a trading company or small business and that VAT is added to the cost of obtaining Route CD's by my 3rd Party handler SW Reg, under their trading agreements and VAT registration number. This service is provided entirely due to the route file sizes on a no profit basis and so far as I (and indeed now C&E) are concerned is legitimate and above board.

To the person(s) who apparently felt it necessary to report that I might be charging VAT but not submitting the revenue - you are sadly mistaken. It has left a rather bitter taste that someone in our "community" could level such a false accusation and has left me seriously considering whether to continue making my MTS routes publically available or even to continue making them at all. The final decision will be made in the next few days.

I have no idea who would want to stir up this sort of trouble, though a few individuals have in the past made their feelings clear about CD distribution. However it might be worth anyone else who is doing CD's to check and ensure their arrangements are not foul of Customs & Excise requirements.

thenudehamster · Post by **thenudehamster** » Fri Jan 30, 2004 3:01 pm

Vern, I hope you will consider at least staying in the construction business. Having just received my compliation CD I'm very impressed with the standard of your work.
Whether you should continue marketing your CDs in the same fashion is another matter. With things being handled through a separate financial entity, it probably does complicate matters somewhat. Have you thought about letting UKTS (ie, Matt) do the marketing of the CDs for you?
Being located abroad the matter of VAT doesn't concern me, and the US doesn't (yet) tax internet order from abroad, which is nice. However, when I was living in the UK, I know the C&E didn't always rely on 'tips' to uncover VAT cheats - a friend of mine got 'visited' just because they didn't believe her submitted figures; maybe your visit was on similar grounds. What they tell you and what their information is aren't always the same - and how anyone would think you were charging VAT and pocketing the money escapes me. That's a very simple one for the C&E to pick up without a snitch call.

Again, I hope you reconsider your situation and come down in our favour.

mbfos · Post by **mbfos** » Fri Jan 30, 2004 3:04 pm

hear hear

"the community" needs Big Vern. Don't let the B******S get you down

bigvern · Post by **bigvern** » Fri Jan 30, 2004 3:12 pm

I did wonder about the circumstances - although they had a copy of my order page, if they'd done their homework properly they would have seen SW Reg are accounting for the VAT anyway. It might even be someone I know from outside the train sim circle but who had a touch of "green eye of the little God.

I'm coming round to the view that I will finish the Blackpool route as I know a good few people are looking forward to that - and if it *was* a vexatious report I shouldn't give in that easily.

As regards ongoing distribution - if C&E say it's okay then no reason why I shouldn't carry on, but then I'll always be looking over my shoulder and what's next - a visit from the Inland Revenue seeking a detailed breakdown of costs and receipts to determine if there's any profit that's subject to income tax?

I suspect what I'll try and do is break the routes down so they can be uploaded here and continue to offer a standard service - where individuals send their own CD and return packaging.

However it does all add to the overall stress levels of what started out as a simple hobby and desire to share my work with fellow train sim fans. Ultimately let's hope that if/when MTS2 ever happens the file sizes will be contained so having to put freeware routes on CD never becomes an issue.

johncarr · Post by **johncarr** » Fri Jan 30, 2004 3:43 pm

Vern please keep going, your contributions to the Train Sim world are in fact known the world over and greatly appreciated.

Unfortunately in this world there is also someone who thinks he/she knows better than you and eventually proves him/herself to be an utter idiot without checking the facts.

Regards John Carr

GeorgeJacksonChurchward · Fri Jan 30, 2004 3:46 pm

I have no idea who would want to stir up this sort of trouble, though a few individuals have in the past made their feelings clear about CD distribution.

Yes me being one of them,but not from a VAT perspective.As far as i am concerned the whole english government can commit hari kari tomorrow,so i certainly don't want to assist them in tax collection.

My grievance is aimed at the fact that here i pay Â£20 a year for premium download facilities and then expected to pay for routes via cd distribution.

For less money $20 on train-sim i am able to download hundreds of files,including routes of all sizes,some small and others huge.

Lad491 · Post by **Lad491** » Fri Jan 30, 2004 3:59 pm

You could use a payment system such as Paypal or Fastpay and people could then pay you direct with no VAT implications at all. I sell a lot of stuff on on-line auctions and thats how i like my buyers to pay.

Paypal costs me a little in their administration fees because i like to be able to offer a credit card payment system, but thats minimal and could always be included in the price. Fastpay the buyer pays the fee rather than the seller. I offer both so people can choose.

davidaward · Post by **davidaward** » Fri Jan 30, 2004 4:06 pm

I'm extremely sorry to hear whats happened there Vern. I think that CD ordering is an Excellent facility, we don't all have broadband.

I hope that you continue to produce superb quality add ons for MSTS which i will be more than happy to purchase and enjoy. Those who have Made the complaint should hang their heads in shame...............

lateagain · Post by **lateagain** » Fri Jan 30, 2004 4:18 pm

Vern,

Thanks for taking the stand and "not letting the buggers grind you down".

Who was it said that "Accountants know the cost of everything and the value of nothing!"

Customs and Excise only had to do a few minutes research to see what payware routes cost. A kid with a calculator could cost the production, labelling, postage etc.etc. of sending out a route on CD.

The trouble is this community just doesn't fit into any "model" that the penny counters can understand!

People give freely of their own time, talent and creativity and then....... GIVE IT AWAY FOR NOTHING?!?!

You can see why it's beyond their comprehension.

A sad reflection on what our society has become?

Don't give up. You know that your efforts are appreciated by, I hope, all of this community.

Geoff

bigvern · Post by **bigvern** » Fri Jan 30, 2004 5:27 pm

I did use Paypal for a while but fell out with them over support issues. Also at least SW Reg do deal with the VAT whereas PayPal being offshore don't so that would complicate matters - maybe make them worse so far as UK "sales" are concerned.

I'll keep things ticking over as they are for now - having just bought another batch of CD's and labels from WHS. The irony is HM Government actually gets VAT twice over from this - via SW Reg and the materials which are all purchased VAT paid (a point I did make to the gentlemen from C&E).

GeorgeJacksonChurchward · Fri Jan 30, 2004 5:33 pm

we don't all have broadband

I don't have broadband,sick of hearing this pathetic excuse for not being able to download large files.

jimmyladd · Post by **jimmyladd** » Fri Jan 30, 2004 5:37 pm

Hi Vern
Could you claim the vat back if you are paying twice? It would be a good poke in the nose of the c&e if you could

bigvern · Post by **bigvern** » Fri Jan 30, 2004 5:45 pm

Strictly no, as SW Reg are actually paying it so things could get very complex. The only way round that would actually be to register as a company, get a VAT number and do the VAT myself. That would add a considerable administrative burden, not to mention at the end of the day there's no "profit" anyway.

Once the Download system comes back on line I'll take a look at getting the new Route Riter and uploading a couple of the shorter routes.

And - please - I don't want this to turn into an anti-CD thread. I'm pissed off enough as it is without having to trot all through that again. I'm trying to work out positive solutions to this - not just delete the whole lot in a fit of anger and go back to playing Total Soccer Manager and (next week) X2 - which at one stage this afternoon I came close to doing.

jimmyladd · Post by **jimmyladd** » Fri Jan 30, 2004 5:54 pm

What GeorgeJacksonChurchward said is not strictly true anyway because if you order a route for Â£4.50 you get a months subscription with it. Considdering how long it would take to download and install something like Tim Coutrs mid east route I think that the additional Â£1.50 you have to pay is peanuts. Please don't give it up Vern, I am just about to send you a CD for your routes because I have been told that they are top class
Cheers Jim

nwallace · Post by **nwallace** » Fri Jan 30, 2004 6:02 pm

My thoguht woudl be that you shove a decent sized sign on the ordering page saying that SWReg deal with VAT.

Niall