Thank you for your comments - I appreciate I am not out of pocket.
However, as noted above, I was looking at the effect on pricing to the end customer and being able to sell for £1,500 + £100 VAT (being 20% of £500 value added) - is cheaper to my end customer than selling for £1,500 + £300 VAT (being 20% of the total selling price).
This makes the cabinet at £1,600 - 11% cheaper for the end customer and the tax man is happy as the £100 he receives is on the value added. I'm happy as I have sold a cabinet and the customer is happy has they have a cabinet 11% cheaper.
All the best
Wonders of Paper Work
Sorry what does OP mean?
Thanks to both
In bro0010 's response - I am however £200 more expensive when selling to Joe Public if I charge the VAT on at £300
Thanks for all your help