VAT on used cars sold by a company

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kellyp
kellyp Registered Posts: 45 Regular contributor ⭐
edited June 18 in AAT member community
Hi, if a company sells one of their vehicles to a director, is VAT chargeable?
Thank you in advance.

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  • douglasstroud
    douglasstroud Registered Posts: 310 Dedicated contributor 🦉
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    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 ⭐
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    Yes, I believe VAT was claimed on the purchase
  • douglasstroud
    douglasstroud Registered Posts: 310 Dedicated contributor 🦉
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    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
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    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
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    yes it is a car. I've also checked if VAT was claimed and it wasn't
  • douglasstroud
    douglasstroud Registered Posts: 310 Dedicated contributor 🦉
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    No VAT on purchase then exempt from VAT on sale
  • kellyp
    kellyp Registered Posts: 45 Regular contributor ⭐
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    thank you very much
  • JasperLeonson
    JasperLeonson Registered Posts: 1 New contributor 🐸
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    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......

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