My partner has purchased a brand new car for his business. He took a loan for it and received a vat invoice from a dealer as they received full payment for the car and my partner will be paying monthly instalments to the loan company for the next 5 years. Could you please advise if he can now claim the vat paid for it in full. He is due to du his vat return now. Just to add he is a sole trader registered for vat. This car is used for business purposes 28 days a month. We would use it once, twice a month when going away as I have my own car which is used daily.
Yes I am sorry, he is a sole trader. He does all sorts of renovation works so he does not need a van. The car's taxation class is light goods vehicle and it is a pick up and it is sufficient for his type of business. All sorts of heavy materials when purchased are delivered on side.
We have a second car which we use for all private issues. So still he can not claim vat paid? I am sorry but this car was purchased for the business and we are not trying to take any advantage.
This is not relevant at this moment but since you asked yes, unfortunately due to personal reason he is away for the next couple of weeks.
It is a forum so I assumed I could get some advice...
Im afraid it is relevant - in that this is a forum for such professionals and not business owners. As such we are unable to provide advice to business owners without having a formal letter of engagement in place. Besides which the information you have given so far appears to be insufficient to provide an in depth answer (which can only be given by your Accountant which is why I asked the question) and now also appears to have changed.
Based on the information provided so far - you cannot claim the VAT.
When is the VAT return due?
What payload does the vehicle have/what is the unladen weigh/what modifications does it have? What is the actual vehicle?
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Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
This is not relevant at this moment but since you asked yes, unfortunately due to personal reason he is away for the next couple of weeks.
It is a forum so I assumed I could get some advice...
Any question asked by Joanne is relevant. I'm assuming that the reason that she asked was the level of confusion that exists around the initial question talking about being a car, then being told it's not a van but a light goods vehicle which of course may (or may not) come under van categorisation so VAT and other tax regulation around it are completely different.
This is as Joanne points out a discussion forum for finance professionals so if you would like for your accountant to ask questions on here then please feel free to point them towards the forum and I am sure that Joanne (or one of our other professional contributors) would be more than happy to help them in the unlikely event that they have a question where they do not know the answer to it.
Of course, something as straight forwards as VAT categorisations on leased vehicles should not cause your professional representation an issue, where conversely the idea that one of their clients has been opinion shopping on online forums might.
I would suggest that you speak to other representation in your accountants office pending your actual acccountants return.
Shaun.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
Probably the thread hasnt been helped by the nuances of the different terminology as well as everything else. But it wouldnt also be helped by the naff naff gov uk site and its total lack of assistance, although of course we all know not to take what HMRC as gospel given their interpretations of the actual law is different. Never mind the million and one scenarios that can exist around vehicles, business entities and their uses of said vehicles - but the place is littered with the bodies of s/t who have tried and failed in the tribunals on this one generally.
Thanks Shaun for you comment!
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Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
