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Posted by: John Brace | 31st October 2014

3 invoices about the Wirral Waters Section 106 agreement with Peel which raises a VAT question?

3 invoices about the Wirral Waters Section 106 agreement with Peel which raises a VAT question?

                                                    

I’d better start this piece by declaring an interest in that I can see the Wirral Waters site from where I live as it’s not that far away.

Below are three invoices that however many times I look at them don’t make much sense to me. However maybe through writing about them I can make more sense of them. I may have this wrong, so if I have please leave a comment as elements from one invoice appear on the other ones so maybe I’m not counting things correctly.

All three are from Eversheds LLP (a firm of solicitors) with an office in Manchester. I’ll put them in chronological order:

20/2/13 Interim Invoice | Wirral Waters Section 106 agreement (to November 2012) | £10,000 + VAT £2,000 = £12,000 | £10,000 paid by Peel Land and Property (Ports) Limited | £2,000 paid by Wirral Council (VAT element)

15/4/13 Interim Invoice | Wirral Waters Section 106 agreement (to November 2012) | £8,133.90 + VAT £1,617.58 = £9,751.48 | £8,133.90 paid by Peel Land and Property (Ports) Limited | £1,617.58 to be paid by Wirral Council (VAT element)

29/4/13 Invoice | Wirral Waters Section 106 agreement (28 June 2011 to 31 July 2012) | £8,000 + VAT £1,577.20 = £9.577.20 | £8,000 paid by Peel Land and Property (Ports) Limited | £1,577.20 to be paid by Wirral Council (VAT element)

Total (across three invoices) paid by Peel Land and Property (Ports) Limited: £10,000 + £8,133.90 + £8,000 = £26,133.90
Total (across three invoices) paid by Wirral Council : £2,000 + £1,617.58 + £1,577.20 = £5,194,78

Which leads me to the obvious question about VAT. When a developer such as Peel Land and Property (Ports) Limited have a legal firm (in this case Eversheds) to draw up a section 106 agreement between themselves (Peel Land and Property (Ports) Limited) and Wirral Council, why does Wirral Council pay the VAT?

I’m not an accountant, so maybe somebody out there with a better understanding of the tax code and VAT issues can help me! Please leave a comment if you understand this better than me!

Wirral Waters section 106 agreement interim invoice Wirral Council 20th February 2013 £12000

Wirral Waters section 106 agreement interim invoice Wirral Council 20th February 2013 £12000

Wirral Waters section 106 agreement interim invoice Peel Land and Property (Ports) Limited 15th April 2013 £9751 48p

Wirral Waters section 106 agreement interim invoice Peel Land and Property (Ports) Limited 15th April 2013 £9751 48p

Wirral Waters section 106 agreement invoice Wirral Council 29th April 2013 £9577 20p

Wirral Waters section 106 agreement invoice Wirral Council 29th April 2013 £9577 20p

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Responses

  1. If the best place to hide a tree is in the forest-probably the best place to hide misdemeanours is in a ‘forest’ of legislation.

    • Or the “forest” of invoices.

      There are other invoices where Wirral Council pays the VAT too.

      I think at the time I was told by a Wirral Council officer that if someone makes a personal injury claim against Wirral Council, Wirral Council’s insurers pay the legal bills.

      However Wirral Council has to pay the VAT on the legal bills. Which when you add it up over all the personal injury claims comes to a large amount!!!

  2. Hi John it may be worthwhile either to do a foi with Wirral council or better still how about a foi to HMRC asking them if there is any irregularities in the way vat is being paid, that should flush the matter out & if there is some sort of fiddle HMRC will sort it out.
    It may be worthwhile informing Wirral of your intention of informing HMRC before you actually contact them, I bet you get a reply quicker than 20 days & then send Wirrals answer to HMRC. Just a thought.

    • Well I’ve been looking into section 106 agreements. They relation to s.106 of the Town and Country Planning Act 1990, there’s also a s.106A, s.106B and s.106C.

      However sums provided to Wirral Council by the developer resulting from s.106 agreements aren’t subject to VAT.

      Some councils charge developers for their council officer costs (and other costs such as external legal costs, photocopying etc) in preparing s.106 agreements.

      Whereas I’ve found out that VAT isn’t charged on the matters arising from s.106 agreements, that doesn’t cover the point of VAT on the costs of preparing and negotiating a s.106 agreement does it?

      There are numerous FOI exemptions that could be used if I made a FOI request to Wirral Council and HMRC on this one.

      VAT unfortunately is a very complex area!

    • Ahh I’ve found this on HMRC’s website about government bodies and VAT. Thanks!

    • Thanks I’ve made a FOI request to HMRC which can be read on the WTDK website.

  3. I believe the game is ‘ Charades ‘ when you make some sought of gesture when getting slightly warmer, however please remember the 1998 ” Act “

    • Well I’ve been reading through the HMRC VAT Manual.

      The supply (the contract) and the services (drawing up the contract) would’ve been supplied to both Wirral Council & Peel.

      However Peel intended to use the goods and services for the purposes of their business. So do Wirral Council.

      Both Peel, Eversheds and Wirral Council were taxable persons.

      However input tax can only be claimed if a number of conditions are met one of these being:

      a) the supply was made to the person claiming the deduction.

      However the “supply” was also made to Peel (who paid the non-VAT element).

      Therefore I’m confused, which is why I’m not an accountant!

  4. Go beyond the Local Aspect and petty Invoices, look at the Bigger Picture

    • The bigger picture is that if major things don’t get sorted out locally, like ripples on a pond, they start effecting the bigger picture.

      Yes I don’t want to get too parochial hence why my latest blog post is about the 1st meeting of the Liverpool City Region Combined Authority Scrutiny Panel, but there are also “bigger picture” implications of what happens at the local level too.

    • These and other matters you have reported are part of the Bigger Picture, I am not decrying your Method of Operation (MO) At times I must admit I was wishing it was small words and Big Pictures

  5. G’day John

    Is Stella VATABLE (Very Affectionate To All Bullying Labor Egotists)

    I dare you to ask “The Football Shirt” or “Phil the Dill” or “The Pretend Friend” or/and of course everyone’s favourite “The Dunny Chain Wearer”? he he he he

    Ooroo

    James

    Ps In Australia it is called GST (Good Sex Tax) err I mean Goods and Services Tax. Nothing to do with Stella.

    Keep up the great work and have a good weekend.

    • Stella Who? Stella Shoe?

      Do they have VAT in China or is it called something else?

  6. I need not say anything more on this or other subjects, it was nice communicating with you OOroooo

    • Well on that note, I will use some Australian slang.

      Putting Wirral Council in charge of BIG/ISUS was like putting Dracula in charge of the blood bank and because it ended up raining cats and whistleblower dogs, Wirral Council was up the creek without a paddle.

      Ooroooo to you too.

  7. Tarras Me Old Mate

    Irreverent Oz here.

    I hope I haven’t chased away your new best friend. sulk sulk sulk

    Is his real name what he says, I feel not?

    Why are people in the UK, keep my head down and don’t say what I think?

    I won’t say anything if Wirral Funny Biz is ripping everything it can from upstanding citizens. I’ll just keep my head down and say nothing.

    Why are these Muppet’s at the council protecting them?

    Ooroo

    James

    Ps I don’t know if you know who he is but I have a suspicion it is “The Shyster” suddenly got a conscience.

    • OK I’ll put it this way to you, Oz:

      A politician has a choice about something terrible. They can be upfront and honest with the public (stop laughing too hard at the back) and get blamed for what happened or they can decide on a cover up.

      Which option do you think happens the most?

      I mean these are the occupational hazards in my job:

      getting shot at
      having my family shot at
      being arrested
      having my family arrested
      vandalism
      death threats
      err all of the above have happened!

      I hate to think what would happen if I was high profile or well known!

  8. Good for you Mr Brace, I can assist you on that one, been there, read the book and wore the tee shirt!!!!!!!!!!!!!

    • Yes there are certain level of behaviour that are unacceptable in society, however some people decide for whatever reasons to not treat their fellow human beings properly.

      Such is life I suppose…

  9. You will find prior to your last comment. this matter goes further back than any other matters already disclosed as I believe you are probably aware

  10. G’day John

    The pen is mightier than the sword.

    I am sure “Highbrow” could tell you who said that.

    You say.

    Yes there are certain level of behaviour that are unacceptable in society, however some people decide for whatever reasons to not treat their fellow human beings properly.

    Such is life I suppose…

    That was all I expected when I went to see “The Football Shirt” and “The Chamber Potty” 3 years ago to be treated properly.

    I could see she was nearly on my side.

    Bring in the Inspectors if super duper directors are going to act like that and then be fully supported by the that circus that was there on 8 October including the auditors silence.

    Ooroo

    James

    Ps How did you know about the blood(y) banks involvement in Big?

    • In answer to your sole question, it was a metaphor based on an Australian phrase.

      But then, in order to answer your question as to the banks involvement, before my father worked for the Magistrates Court, he worked for some banks.

      I’m expecting a “boo” from my readers on that snippet! However the rest of my immediate family (all three of them) worked for the NHS, so there tends to be a combination of medical humour, legal humour and financial jokes in the family.

  11. G’day Tarras

    I am pissed…. after all it is Saturday night as you will probably tell from my 21.40 ish posting on Wirral Leaks.

    My sole question to you really related to…. can’t really remember…. but I think was a reference to the “BIG PANEL” member from the bank who is another one that won’t speak up so everyone can hear him but knows what really went on. And it wasn’t RIGHT according to him.

    War….hopefully not, the Wirral is full of cowardy cowardy custards.

    But we all know that, don’t we??????

    How can people go with the flow when they know it is downright wrong??????

    I used to trust people to be honest Tarras.

    Ooroo

    James

    Ps And to put yourself up for Public Office and act like THEY do…..

    Pps I’ve ranted myself sober and it is not a better place.

    night night sleep tight

    God Bless


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