BMW AUC VAT Applicable
- Thread starter srhutch
- Start date
From HM R&C
Buying second-hand vehicles
If you buy and sell second-hand vehicles you might be able to account for the VAT by using the margin scheme, but only if there is no VAT shown on your purchase invoice. When you sell a vehicle under the margin scheme, instead of paying VAT on the full selling price, you work out the VAT due only on the difference between what you paid for the vehicle and what you sell it for - your 'margin'. There is no VAT for you to reclaim.
To be considered second-hand, a vehicle must actually have been driven for business or pleasure - it can't just have been registered and have delivery mileage.
You'll usually be able to use the scheme for used vehicles you buy from:
•private individuals
•dealers who aren't VAT-registered
•VAT-registered businesses who were unable to recover any input tax
•dealers who are VAT-registered but who sell you vehicles that are eligible under the margin scheme - their invoice shouldn’t show any VAT and must have a statement that identifies the supply as being within the margin scheme
You won't be able to use the scheme for a used vehicle where there is VAT shown on the invoice. If VAT is shown then you can reclaim this VAT in the normal way provided you meet all the rules for reclaiming VAT, but you'll have to account for VAT on the full selling price when you sell the vehicle.
The margin scheme also covers commercial vehicles.
To use the margin scheme you'll need to keep detailed records of your purchases and sales and the margins you’ve achieved.
Buying second-hand vehicles
If you buy and sell second-hand vehicles you might be able to account for the VAT by using the margin scheme, but only if there is no VAT shown on your purchase invoice. When you sell a vehicle under the margin scheme, instead of paying VAT on the full selling price, you work out the VAT due only on the difference between what you paid for the vehicle and what you sell it for - your 'margin'. There is no VAT for you to reclaim.
To be considered second-hand, a vehicle must actually have been driven for business or pleasure - it can't just have been registered and have delivery mileage.
You'll usually be able to use the scheme for used vehicles you buy from:
•private individuals
•dealers who aren't VAT-registered
•VAT-registered businesses who were unable to recover any input tax
•dealers who are VAT-registered but who sell you vehicles that are eligible under the margin scheme - their invoice shouldn’t show any VAT and must have a statement that identifies the supply as being within the margin scheme
You won't be able to use the scheme for a used vehicle where there is VAT shown on the invoice. If VAT is shown then you can reclaim this VAT in the normal way provided you meet all the rules for reclaiming VAT, but you'll have to account for VAT on the full selling price when you sell the vehicle.
The margin scheme also covers commercial vehicles.
To use the margin scheme you'll need to keep detailed records of your purchases and sales and the margins you’ve achieved.
Nice... leaving you absolutely no excuse not to M up 8)
srhutch said:
I know, but with you and you future M it's always good to sneak in a bit of a
