From Monday 1st December 2008 the VAT rate will drop from 17.5% to 15%. We're pleased to confirm that we will pass on the benefits to our customers. Subscription charges made on or after 1st December will have VAT charged at 15%. This applies to new and existing customers. We've put together a FAQ to answer some of the questions we're being asked. What are Plusnet doing about the VAT changes? We'll be passing on the reduction in VAT to our customers in their regular monthly subscriptions. Some ‘one-off' charges such as postage and packing on hardware won't be changed. How will this affect me? If you are a residential customer you will see a modest reduction in your monthly subscription fees. For business customers where prices are quoted excluding VAT, the price will remain the same, but the amount of VAT paid will be 2.5% lower. What about referrals? Referrals for residential customers will remain as they are - we're not making any changes for referral credits. In other words we're not reducing the amount we give you back in referral value for residential products in line with the VAT changes. However, for business referrals where pricing is excluding VAT, the paid out value will be slightly less after VAT is calculated. Does this affect Broadband and Home Phone/Talk? Yes, this will lower the monthly cost all of our residential subscription services including Home Phone. What about Home Phone top ups? We're not making any changes to the way that you can top up your Home Phone account, but whatever you top it up by, will go a little bit further! What about domain pricing? As we quote domain pricing on our website as excluding VAT, the quoted price will remain the same, but the amount of VAT payable will be reduced. What if I'm on a product that you don't sell any more? Our old products (no longer for sale) will also have their subscription costs reduced accordingly. For example, Broadband Premier will be charged at £21.52 instead of £21.99. Isn't this a change to my Terms and Conditions? It's not a change to your terms and conditions as the price has not increased. We're only required to give our customer notice of a change to their terms and conditions if there is a "detrimental change", such as a price increase. Can you give me more detail about what I will pay? Won't the prices be a little odd? If, for example, your broadband subscription is currently £9.99 and is paid on the 23rd of every month you'll pay less, £9.75 to be precise, on 23rd December. Keen mathematicians amongst you will have noticed we've rounded-down the reduced cost by a further 3p to make a ‘manageable' price point. We'd find it difficult and clumsy to have products at a price point of £9.78 for example. Over the year that represents a total saving of £2.88. If you have a question not covered here please do ask and we'll be happy to look into it for you.
VAT Change: Update