ProperCharlie

Can anyone let me know what the position is with a VAT registered company selling a car second hand? Do we have to add on VAT or is it expempt?

tia.

gsm1

Isn't only if you claimed the VAT back when new then you have to add VAT when selling?

Dream Weaver

AFAIK you cant add VAT to second hand goods, may be wrong though.

ProperCharlie

I imagine we claimed the vat back when the vehicle was purchased, although it was via a finance agreement - i'll have to look into that aspect of it.

Aztec Performance Ltd

iTrader: (234)

you are supposed to add VAT to most second hand goods.

never seen this applied to cars though with the exception of Gov cars @auction.

Does apply to commercial vehicles though.

Bob

ProperCharlie

It's a non-commercial vehicle (Legacy Outback).

gsm1

It used to be only Commericial but they changed the VAT rules a few years back. Go to car auctions today and there are plenty of non-commercial vehicles that the VAT can be claimed back on.

Frosty The Snowman

Depends whether it's a VAT qualifying vehicle and if VAT has been claimed on the purchase. Apart from that you don't add VAT to the sale of second hand cars. If you make a profit on the car then you have to pay VAT on that profit element.

ProperCharlie

Thanks for the info. I think we'll assume that VAT isn't applicable. Speaking of which - we've got a VAT inspection next month.