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Post Info TOPIC: Purchase of assets from liquidator & VAT
BazzaS


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Purchase of assets from liquidator & VAT
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I've purchased the assets of a liquidated company. The liquidator has charged VAT on this. I am a sole trader on the Flat Rate VAT scheme so I cannot reclaim the VAT charged by the liquidator.

How, please do I account for this VAT ?

Should it be written off as a cost of business or rolled up as an "asset" or what ?

Thanks



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MarkS


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Hi Bazza

Depends on what you are buying and the value.

If is capital  goods and the VAT inclusive amount is £2k or more then you can reclaim the VAT.  If not, then the VAT is just added to the cost like any other cost/expenses under the FRS.

See the following link on HMRC that give more details about when you can reclaim VAT on capital goods under FRS

Mark

 



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Mark Stewart CA

http://stewartaccounting.co.uk/

Providing accounting, bookkeeping, payroll and tax services to small and medium sized businesses across Central Scotland and beyond.
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