VAT & CARS

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT student discussion
Someone runs a florist and buys a car. It is invoiced to the business and paid for by the business. Do you claim back the VAT?

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  • System
    System Posts: 100,534 🤖 Admin 🤖
    VAT & CARS

    No, you can't reclaim the VAT on cars, only commercial vehicles, i.e. vans etc.
  • System
    System Posts: 100,534 🤖 Admin 🤖
    VAT & CARS

    Well, that was how I understood it. I completed a Vat return for college and it was marked incorrect as I should have claimed the vat back as the car was for business use only. It did not say anywhere in the question it was for business use, so I presumed that as it was a florist someone if not the owner would be using the car for personal use. I can't imagine why a Florist would want a poole car!!!<BR>
  • System
    System Posts: 100,534 🤖 Admin 🤖
    VAT & CARS

    VAT, at 17.5%, will be payable on any new car purchased in the UK or imported from overseas. Once itâ??s clear that a vehicle is a car, the key issue is whether this VAT can be recovered by the purchaser.<BR><BR>Assuming the purchaser is registered for VAT and ordinarily entitled to recover it on other costs, VAT incurred on a car and any fitted accessories can only be recovered if that car is used exclusively for business purposes. Essentially, the purchaser must be able to prove a car is not available for private use.<BR><BR>In practice most cars will have some element of private use which will block the buyerâ??s entitlement to recover VAT. Even if the purchaser has a highly regulated policy, any VAT recovery on a car is likely to be challenged by Customs and Excise on principle. From Customsâ?? perspective, even permitting an employee to keep a pool car at home overnight before a business trip is considered sufficient to block VAT recovery.<BR><BR>If there is any private use, no VAT at all can be recovered on the purchase of the car. At present, there is no apportionment between private and business use, just a straightforward 100% VAT block.<BR><BR>
  • System
    System Posts: 100,534 🤖 Admin 🤖
    VAT & CARS

    Hi<BR><BR>Just to throw another stick in the works...<BR><BR>If the business leases a car and that car is used for both private and business use, you can reclaim 50% of the VAT.<BR><BR>
  • System
    System Posts: 100,534 🤖 Admin 🤖
    VAT & CARS

    I have tried several times to reclaim VAT on cars. The words NFC spring to mind.
  • System
    System Posts: 100,534 🤖 Admin 🤖
    VAT & CARS

    Hello<BR><BR>Our compnay leases cars for our engineers and sales people, we can claim 100% vat on the Maintenance charges but only 50%vat on the lease costs.<BR><BR>Hope this helps.<BR><BR><BR>Claire

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