Get spending to beat the VAT hike

Published by Nathalie Bonney on 09 December 2010.
Last updated on 20 December 2010

shopping bags

It's not often Moneywise encourages you to spend but with VAT set to rise from 17.5% to 20% on 4 January, if you're thinking of making any major purchases now is the time to do it.

Just in case you need any more convincing, Moneywise has done the calculations to show you the price of goods and services before and after the VAT rise.

HOME ENTERTAINMENT

It's true that the new year will bring the January sales, but pre-Christmas sales on these sorts of goods are increasingly common as retailers compete to attract Christmas shoppers. Why not avoid the January frenzy and buy your new technology now?

Packard Bell laptop

Price currently: £499.99
Price in January: £510.62
Saving: £10.63

Samsung Plasma TV

Price currently: £999.99
Price in January: £1,021.26
Saving: £21

Try our new VAT calculator to find out how much you will pay after the VAT rise on 4 January.

NEW FURNITURE

What is it about sofa companies and sales at this time of year? DFS, for example, has a half-price winter sale and guarantees delivery before Christmas.

DFS Kenzie range three-piece suite

Price currently: £2,524
Price in January: £5,181.53*
Saving: £2,657.53 (£129.53 VAT saving)

* furniture goes back up to pre-sale price

HOME IMPROVEMENTS

You might think it's too late to get any home improvements - like new carpets or double-glazing - done before the end of the year but you might be surprised. While you may not get the work done this year many firms will be prepared to honour this year's VAT rate if you accept a quote before the new rate kicks in. Given that this is one area where VAT hits hardest, it's worth investigating if it saves you a few hundred pounds.

Central heating installation

Price currently: approximately £4,700*
Price in January: £4,800
Saving: £100 

* based on a 3-bed semi, including radiators and labour costs

Carpet fitting

Price currently: approximately £3,500*
Price in January: £3,574
Saving: £74

* based on a 3-bed semi, with basic carpet fittings

SONY VAT CASHBACK DEAL

Electronics retailer Sony is promoting a 'get the VAT back' offer on some of its products. To take advantage of the deal, you'll have to pay the full price initially, either online or at a participating store, then fill in a form and submit it before 31 January 2011.

You can download the form from the website, sony.co.uk, or get one in-store. It could prove worth your while: for example, a £1,799.99 3D TV would cost £1,531.91 without the VAT – a saving of £268.08.

For a list of participating retailers in your local area, go to the website and enter your postcode. If you have any more queries regarding this deal, contact Sony's special promotions line (01379 649 999).

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