VAT on used cars sold by a company

kellyp
kellyp Registered Posts: 45 Regular contributor ⭐
edited February 2023 in VAT
Hi, if a company sells one of their vehicles to a director, is VAT chargeable?
Thank you in advance.

Comments

  • douglasstroud
    douglasstroud Registered Posts: 310 Dedicated contributor 🦉
    If the no VAT was claimed on purchase which is normally the case because it is blocked for private use then the car would be exempt as far as I am aware.
    Or did you claim VAT on purchase?
  • kellyp
    kellyp Registered Posts: 45 Regular contributor ⭐
    Yes, I believe VAT was claimed on the purchase
  • douglasstroud
    douglasstroud Registered Posts: 310 Dedicated contributor 🦉
    Seems odd that VAT was claimed on a car purchase as it is usually blocked unless the business is either driving school, car hire, taxi or it is a pool car.
    Anyway if it was claimed correctly then yes you will need to charge VAT on the sale which I believe will also have to be at market value
  • douglasstroud
    douglasstroud Registered Posts: 310 Dedicated contributor 🦉
    edited February 2023
    I have been basing my answers on the vehicle being a car, that is correct?
  • kellyp
    kellyp Registered Posts: 45 Regular contributor ⭐
    edited February 2023
    yes it is a car. I've also checked if VAT was claimed and it wasn't
  • douglasstroud
    douglasstroud Registered Posts: 310 Dedicated contributor 🦉
    No VAT on purchase then exempt from VAT on sale
  • kellyp
    kellyp Registered Posts: 45 Regular contributor ⭐
    thank you very much
  • JasperLeonson
    JasperLeonson Registered Posts: 1 New contributor 🐸
    Thanks for this helpful exchange! Just wanted to confirm, if no VAT was claimed on the original purchase, then selling the car (even to a director) would indeed be outside the scope of VAT, so no VAT needs to be charged on the sale. This clears it up perfectly......
  • duncan123
    duncan123 Registered Posts: 15 New contributor 🐸
    Hi, we are building an automated tool to help businesses to identify both historical VAT risks and missed opportunities to claim VAT. It will sit above Xero, Quickbooks and SAGE and integrate seamlessly whilst keeping your data totally secure. Kind of like a 'quick VAT health check.' Just wondering if you'd find something like this useful? Thanks

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