VAT

System
System Posts: 100,534 🤖 Admin 🤖
edited 10:31AM in AAT student discussion
Sorry but I've got another question on VAT.

VAT is not recoverable on the purchase of a company car.

BUT.... is it recoverable on the purchase of a company van?

Thanks

Karen

Comments

  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:VAT

    Hi Karen.

    VAT is recoverable on commercial vehicles.

    Scott.
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:VAT

    Thanks
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:VAT

    Hi


    In order to remember if a vehicle can claim back vat I tell myself...


    "with a van you can"

    "with a car you can't"


    It's simple and easy to remember! (A bit like myself!)

    Tracy
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:VAT

    VAT is hardly a specialist field of mine and im a bit confused.

    This link:

    http://www.businesslink.gov.uk/bdotg/action/detail?type=RESOURCES&itemId=1073790964

    says that VAT can be recovered on any company vehicle as long as it is used 100% for company use. So if its a company car thats never actually taken home you can reclaim the VAT - is that correct?
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:VAT

    I think that it is incredibley difficult to prove to Inland Revenue that the car is never used for anything but business and the onus is on you to prove it! I think that is why nobody reclaims VAT on cars.

    Annette
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:VAT

    HI thanks for your answer but it still seems very odd to me. I mean tens of thousands of pounds could be saved if you reclaimed the VAT? If the Inland Revenue say you could do it might even be cheaper to keep masses of evidence that they werent for any private use????
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:VAT

    I think my degree is giving me a to inquisitive mind!

    VAT Notice 700/64 states:

    3.5 When is a car used exclusively for a business purpose?
    A car is used exclusively for a business purpose if you use it only for business journeys and it is not available
    for private use. This means that you do not intend to make it available for the private use of employees or
    anyone else.

    3.6 What does “making it available for private use” mean?
    A car is available for private use when there is nothing preventing you or your employee from using the car for
    private use. The fact that you bought your car for the purpose of your business is not the only requirement.
    You need to ensure that the car is not made available to any one else.

    3.7 Can I recover the VAT incurred when I buy a pool car?
    Yes as long as it is:
    normally kept at the principle place of business;
    not allocated to an individual; and
    not kept at an employee’s home.

    http://customs.hmrc.gov.uk/channelsPortalWebApp/downloadFile?contentID=HMCE_CL_000090

    So although it does seem possible to claim the VAT back on a car, it is unlikely that you would meet the above three requirements. Although the amounts of money involved would seem high enough to warrant remembering that you can claim it back in certain circumstances!

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