VAT on selling used computers....?

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tillyjbc
tillyjbc Registered Posts: 46 Epic contributor 🐘
in General accounting discussion
Hi

Hope you don't mind me hopping over the student fence to ask a question here - I'm currently on Level 4 and am employed part time by a very small (3 other employees) VAT registered graphic design consultancy to look after sales/purchase ledger and prepare VAT returns, approved by an accountant that they use for other aspects eg. payroll, year end etc. Hopefully I will be able to do all this for the company eventually, but one step at a time!

My question is, the company wants to sell some used equipment - outdated camera equipment and some obsolete computer equipment that still has good resale value. Do we charge VAT on these sales - is it relevant that some of the equipment we purchased originally was new (with VAT), some second hand.

Apologies if this seems a very basic obvious question, but not something I've had to deal with yet!

Thanks very much for any advice received!

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  • T.C.
    T.C. Registered, Tutor Posts: 1,448 Beyond epic contributor 🧙‍♂️
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    I can't see any reason why you should not charge VAT. They were purchased and the VAT reclaimed, so it should be charged again when the items are re-sold. Just like a van or other equipment really.
  • tillyjbc
    tillyjbc Registered Posts: 46 Epic contributor 🐘
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    Thanks for your reply TC

    I think what confused me was that although the equipment has all been purchased through the company, not all the items were purchased new with VAT (ebay - sometimes from private sellers, camera equipment seems to hold its value very well!) but I now understand that the purchase history holds no relevance, we have to charge VAT as it is sales through the company. I hope I will be corrected if I have misunderstood!
  • deanshepherd
    deanshepherd Registered Posts: 1,809 Beyond epic contributor 🧙‍♂️
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    Have a look to see if you can use the second hand goods scheme for any items purchased second hand for which you were not charged VAT.

    If you can, you do not charge VAT at all on the sale but instead pay over VAT on the margin (sales price minus purchase price). If you are selling for less than the purchase price then you will probably avoid VAT altogether.

    Not sure if this can be used for assets as well as goods bought for resale though so worth checking.

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