Credit, debts and related services: credit and related services: administration charges and option fees
There may be other charges in relation to the supply of credit by the retailer of goods or services. Item 4 states that any charge for administrative arrangements and documentation and the transfer of title to the goods will only be exempt if the charge does not exceed £10.
This treatment was challenged successfully at tribunal in the case of *Wagon Finance Ltd (Tribunal decision 16288), *which found that the charge represented additional consideration for the credit and should therefore be exempt even when exceeding £10.
Thus exemption applies to any connected credit ancillary charges no matter what the amount charged is, unless the contract explicitly states that the charge relates, wholly or partially, to the supply of goods.
Fees related to goods, such as option fees or fees for transfer of title do not fall within item 4. This is because they represent the right to secure, if the necessary conditions are fulfilled, ownership of the goods. (See General Motors Acceptance Corporation (Tribunal decision 16137).