Hi just read something that says as of October 1st ( today) salon owners who rent chairs out must either pay 20% vat or the owner must add the 20% on to the chair renters fee even if theyre not vat registered? Very worried now as I rent out 3 chairs! Has anyone else heard of this and does it affect small salons? X
20% VAT on chair renters!
- Thread starter Brownie
- Start date
Help Support SalonGeek:
persianista
Well-Known Member
Yep, if you are vat registered, you need to charge your chair renters 20% vat on your rental price. Previously rent was not vat able, but this was changed in the last budget.
persianista
Well-Known Member
No, as you are not allowed to charge vat until you are vat registered. Just make sure your contracts and procedures are correct and watertight, otherwise the taxman can take all the income coming into your salon (even generated by your renters) into account and claim you should be vat reg and fine you for not registering.
Jennifer89
Member
Hiya I'm in the same situation, I work in a small barber shop and have been paying £20 a day chair rent but now 20% VAT has been added its now £24 a day. However, I am still paying 50% from my gross. So I get my daily gross takings, I get 50% and so does my boss, but then out of my 50% I have to pay the £24 for chair rent (and now VAT) no matter how quiet or busy. I pay for all my equipment and products out of what I have left Aswell as tax and national insurance obviously! Is this correct or am I being done over?? Any help and advice would be much appreciated
TracyS
Well-Known Member
Bloody hell Jennifer - I'm no hairdresser but that sounds like a bit of a raw deal! So for arguments sake you gross £100 a day, out of that the salon owner gets £74 and you get £26 then have to buy all your products etc..... I stand to be corrected but it sounds like you're being done over to me huni!!!!
xx
cherrybaby
Well-Known Member
Strictly speaking the salon owner gets £70, the tax man gets £4 and you get £26
But I agree, that sounds rubbish!!Jennifer89
Member
Yes that is correct! I know! And I've had days where I've gone home with less than £20 for being there the whole day where it is quiet! Y boss says this is correct and I get it really good but I don't think I do and certainly don't now. I am not really sure what to say though as I don't have anything to back me up as there are no rules as to chair rent and percentage is there?
Thanks for the replies guys
Thanks for the replies guys
It should be one or the other Hun, you pay a percentage or a flat rate, not both. 50% is also a lot anyway, the highest iv seen is salon taking 40% if you supply product or 60% if they supply, that's without a rent fee.
I'd have to tell them to put their scissors where the sun don't shine! Xoxo
Carlalouise
Well-Known Member
No there are no rules but honestly hun, they're taking the p!!! I wouldn't be surprised if you found out they were not even VAT registered.
Talk to other salon owners see what they say, if I were you I would start looking for somewhere else.
Jo's Nails
Well-Known Member
Hi, I will be renting a room in the next few weeks it's a small business. Not vat registered but does this mean that I have to pay rent plus vat on rent?.
Jo's Nails
Well-Known Member
Ok thanks taggyboy.
pippy
Well-Known Member
OMG!!! you are not being done over you are being flatened hun!!! the salon owner can either take rent or a cut but can not do both and specially if you are supplying your own products and the clients were acquired by yourself then he only gets the rent. even they are taking a cut the max. as tomme said is 40% and tat's only if they are supplying you with extras like products and the like.
renegotiate your contract babe or leave it you are being bled dry here.xx
