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womble
Posts: 6007
Joined: 3/14/2005
From: Living on the edge
Status: offline
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Confused (.com lol) by 1&1 domains - 1/11/2009 6:54:05
Anyone in the UK use 1&1 for domains?
I guess I need to contact their customer support/billing dept for a definitive answer, but the reason I'm confused bewildered by them is that in the last couple of days I've had two invoices and two credit notes from them, which appear to be something to do with the change in VAT rate.
The first one, I ignored, on the grounds I thought I'd cancelled that particular domain...which checking my account it seems I obviously didn't get round to doing (I no longer use that domain for a separate site, but have it parked on another domain with its associated site)...but it appears I don't actually owe anything anyway, as the credit is for more than the invoice amount, which presumably is something to do with the change in VAT rate.
The second one though, has me totally bewildered. I manage the domain on behalf of a client, and although the domain was purchased late in 2007, which would mean that it would be past renewal anyhow, we transferred the domain to another registrar (the hosting company their site's with, to make managing things easier) in December. I've just checked their client account on the hosting company's site, as I have full access to that (they're not particularly techy, and just handed over all the account details to me and said "we'll let you sort all that stuff out", as they get rather confused my domains and stuff) and the domain is now definitely well and truly under control of them, rather than 1&1, so I'm at a bit of a loss as to why an invoice (and credit note) dated 10/1/09 would be generated for a domain that was transferred away from them on 18/12/08?
The only thing I can think is that as the domain was transferred away from them after the new VAT rate came into effect, that's why somehow I've ended up with this invoice. Again though, it appears though that nothing's owed, as the invoice is for £6.94, and the credit note's for £7.03.
As my email address is listed as the contact email on the account with 1&1, all invoices and stuff come to me, and I usually pay them, then forward them onto the client and bill them for whatever it is, and forward copies of any paperwork to them for their records. Though nothing's payable, I don't want to forward this stuff onto them though at the moment, as they'll be totally confused by it all - if I can't figure out what's going on, I'm sure they'll be totally bewildered by it!
I've always found 1&1's billing practices and invoice layout to be confusing at the best of times, but this one's got me totally confused, and before I try and get any sense out of 1&1's billing department (a process which is usually more confusing than the initial query), I thought I'd see if anyone else has experienced anything similar with them and can shed any light on what might be going on here.
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~~ "A cruel god ain't no god at all" ~~
~~ Erase hate. Practice love. ~~
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treetopsranch
Posts: 1539
From: Cottage Grove, OR, USA
Status: offline
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RE: Confused (.com lol) by 1&1 domains - 1/11/2009 12:53:01
Was that an automated email they sent you? I have one host that sends me automated reminders that scare me when it says that your domain will expire if you don't renew it by x number of days. Since I have a auto renew on that host I called them on it and they said that notice is sent out to remind us to check credit card info like expiration dates etc.
(Even though the notice sent didn't mention to check credit card info.) Go figure..
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Don from TreeTops Ranch, Oregon
"I've got a taste for quality and luxury"
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womble
Posts: 6007
Joined: 3/14/2005
From: Living on the edge
Status: offline
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RE: Confused (.com lol) by 1&1 domains - 1/11/2009 20:23:29
I'm not sure if it's automated or not. It's not one of those "your domain will expire if you don't renew it by x number of days" ones - as I said, with the second domain it's not even a domain that's with them any more, and it was renewed in November. I've not had chance today due to other complications, but I think I'll have to get onto their billing dept tomorrow.
_____________________________
~~ "A cruel god ain't no god at all" ~~
~~ Erase hate. Practice love. ~~
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kitbarker
Posts: 1
Joined: 1/12/2009
Status: offline
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RE: Confused (.com lol) by 1&1 domains - 1/12/2009 4:27:34
I've spent *a lot* of time sorting this one out so hopefully my experience will save someone else the same confusion!
I have around 100 domains with 1&1 and so far I've received around 20 emails with an "invoice" and "credit note" attached.
This is what they're doing...
For any domain or service pay for in advance over the 1st December 2008 VAT change they are *refunding* you the pro-rata difference of the 2.5% VAT reduction. That sentence may need reading a couple of times! Here's an example:
You have 10 domains at £10 per year excluding VAT (to keep it simple). They were registered on 1st June 2008, six months before the VAT change. You will have paid £17.50 VAT on the total amount. When the change occurred, 1&1 chose to *refund* the VAT "overpayment" for the six month period from 1st December 2008 to 1st June 2009.
So, they calculate that you have paid for six months (or half of the total amount) at a 2.5% increased VAT rate. They believe you've paid £1.25 too much (£2.50 for the year, divided by two for the six months).
The way they get this credit to you is by pretending to raise an invoice for the *reduced* amount, in this case £116.25 including VAT. This breaks down as £58.75 (£50 + 17.5% for the first 6 months before the change) plus £57.50 (£50 + 15% VAT for the six months after the change).
Then raise a credit note for the amount they charged you initially, in this case £117.50.
The result is a credit to you of £1.25.
It's worth noting that only the final credit will appear on your bank statements. They are not actually charging and crediting you the individual amounts.
So all that effort and confusion for £1.25! But wait. It gets better if you're a company and / or VAT registered. I am both.
First of all, there is the accounting overhead. As I said, so far I've had 20+ emails with invoices and credit notes attached. That is going to add to my accounting bill. Add to that the fact that this isn't a sale, it's a VAT repayment and you will be spending many hours working out what the hell you do with it.
It's a VAT repayment on an invoice that was raised and paid for in last years accounts. I'm working out with my accountant what we need to do.
All of this for something 1&1 didn't need to do. The HMRC VAT guidelines are quite clear. You can choose to use the old rate or the new rate for services that straddle the VAT change. So why didn't they leave it as it was? And they will gain nothing at all from it!
Well, I hope that's cleared things up for someone and saves them having to go through the pain I did to find it all out!
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