If you buy a refurbished iPhone, you probably do not pay attention to whether it is a VAT or margin product. Still, it can affect the price. We explain the difference and how you can take advantage of it.
Which model, which color, how much storage capacity and of course the best price: when you buy a new smartphone, there are many things to take into account. It is therefore not surprising if you have never asked yourself whether it is a VAT product or a margin product. Yet the difference between these two is something that can give you a cheaper device. That is the case.
- The difference between margin and VAT products
- VAT or margin product, what should you choose?
- VAT or margin product, who sells what?
The difference between margin and VAT products
Let’s start at the beginning by explaining what VAT margin products are. We really need that definition later in the article.
- VAT product: A standard product on which the standard tax is levied. Most of the items you can buy in the store are VAT products.
- Margin product: A margin product is a used product that has been purchased and for which less VAT has to be paid. because of this can the price will be cheaper for the consumer.
Margin products arise when a store purchases a product that has already been used. Because VAT has already been paid on the original purchase, this does not have to be done again. As a result, VAT is not applied to the original price and VAT is only levied on the profit percentage, which is a lot less than for standard products. In addition, many margin products are the devices that consumers trade in with a provider, for example when they take out a new subscription.
There are also some rules that ensure, among other things, that not every refurbished iPhone is a margin product as standard. For example, the margin rule only applies to products purchased within the EU. If a refurbished seller picks up the devices outside of Europe, VAT must therefore be paid on the full amount.
It differs per store what is done with the price advantage of a margin product. For example, it can be decided to pass on this benefit to the consumer, so that the sales price is lower. With the same provider, a margin device is generally cheaper than a VAT product in that case. Another store can of course also choose to pocket this benefit and put the margin product in the stores for the same price as a VAT product. Then you as a consumer no longer benefit from it.
VAT or margin product, what should you choose?
Now you naturally want to know what the best choice is: a VAT or margin product? There is no unequivocal answer to that question, it differs from person to person and from price to price.
When do you choose a margin product?
It is best to choose a margin product if you do not want to reclaim VAT on the amount and a VAT product is not cheaper elsewhere. This will probably be the largest group of people.
When do you choose a VAT product?
If you are an entrepreneur, it is important to pay attention. As an entrepreneur you can deduct the VAT costs of a product, so you have to calculate whether a margin product is still cheaper than a VAT product from which you can deduct the 21 percent VAT. Because you cannot deduct VAT on a margin product, it may be less valuable to choose such a product.
VAT or margin product, who sells what?
The big question now is how you can get a cheaper refurbished iPhone for this. Unfortunately, there is no unambiguous rule for this, because every seller deals with this in his own way. The scheme works as follows at a number of large refurbished providers in the Netherlands.
- Forza: only VAT scheme
- Leapp: only VAT scheme
- iUsed: only VAT scheme
- Rephone: only VAT scheme
- Coolmix: only VAT scheme
- YourMacStore: only VAT scheme
- Refurbished iPhone shop: only VAT scheme
- Rebuy: only margin scheme (so no VAT deductible)
- Telephone discounter: only margin scheme (so no VAT deductible)
- Mobico: only margin scheme (so no VAT deductible)
- Telsite: only margin scheme (so no VAT deductible)
- Refurbished.nl: Choice of VAT scheme and margin products
- Swoop: Choice of VAT scheme and margin products
- Partly: Choice of VAT scheme and margin products
Most shops that offer both VAT and margin products often clearly state on their website under which scheme an offered device falls. If you have any doubts about this, we recommend that you always contact customer service to see if they can help you with this in order to ultimately make the best choice.
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