Saalro

iTrader: (8)

Why do you have to pay VAT when buying a van from a dealer?

Thanks

Hanley

Because you pay VAT on everything you buy, apart from the few exceptions!!

Saalro

iTrader: (8)

Sorry but i mean, why is it on vans they say £x + VAT when buying from a dealer, where as when buying a car from a dealer it's not +VAT.

Thanks

Dr.No

'cus it's a commercial vehicle.

The buyer is charged VAT on the full value of a new car when it's first sold, so used cars are sold as VAT inclusive (and the dealer actually pays VAT on his margin - but you don't care about that or need to know).

As it's a commercial vehicle, it will always attract VAT on its new or used value - but companies will usually claim it back (or not pay it in the first place). hence if a private individual wants to buy it, you can't claim the VAT back and have to pay it.

In a nutshell!

GC8

Because it was sold plus VAT and the previous VAT registered owner claimed it back. This is why some are +VAT and others not.

If its not being sold +VAT then there is only VAT charged on the difference between the dealers buy and sell price, which is hidden and not recoverable by a VAT registered buyer.

To explain further - if you buy that VAN and pay the screen price, plus VAT and then sell it to me, even back to the dealer, then itll be sold as a 'No VAT' van, because you paid the VAT without claiming it back.

Saalro

iTrader: (8)

When you buy a brand new car though surely you pay VAT but it's covered in the price?

Can you claim VAT back through a company on a car, or only if it is a commercial vehicle.

Thanks

ScoobyWon't

A VAT registered company can claim back any VAT they have paid on any purchases.

Gear Head

iTrader: (2)

For company use.

The reason commercial vehicles are advertised as £9999 + Vat for example is because the purchaser will always claim the vat back, so the price they pay is £9999.

If you were a private buyer and bought a new car, the £12,000 asking price would be including vat as you would never be able to claim the vat back.

It's quite simple really.

Saalro

iTrader: (8)

Thanks

bigsinky

if the van is bought for business both the VAT and depreciation on the van can be offset in your business accounts at the end of the year. the whole cost of the van can be written off over a number of years as a business expense provided it is wholly used for business purposes.

pimmo2000

iTrader: (6)

Why do companies get the claim the VAT back ?

Luan Pra bang

Because they pay it.

pimmo2000

iTrader: (6)

Huh?

Luan Pra bang

If you go to a shop and buy a TV for 1k then the company you buy from will then owe the VAT man £200 minus the VAT they payed when buying the TV so if they payed 500 for the TV from a supplier then they pay 500 plus 20% vat so they have payed 600. The extra hundred comes off the VAT bill the shop has to pay but the distributer will have to pay that £100 to the tax man. Other wise the same VAT would be paid by both the shop and the distributer.

pimmo2000

iTrader: (6)

So what's the vat we pay? 20% our whatever it is

MMT WRX

What small island do you live on pimmo

pimmo2000

iTrader: (6)

I googled it, so the VAT is passed on the (basically) the end user.

His detailed reply (thanks for that) said they paid the VAT, but then we pay VAT too .. so it all got very confusing for someone as simple as me.

Devildog

Cars are sold vat inclusive so that private individuals see the total cost price.

Commercials are sold net plus vat so vat registered entities can see what the net cost to them will be as they get the vat back.

Simples.

jav127

But if i sold the van and didn't claim back the vat because i'm not vat registered , then you or the dealer has to sell the van without vat , is that correct ?

stockcar

wow, old post resurrection.............

if a VAT registered dealer buys a s/hand vehicle from Joe Public and no VAT applies then when he sells it its normally done under the "margin scheme" where he does charge VAT but only on the difference between buy-in and sales price........(as I understand it)

privatebuyer

I understand the concept for those VAT registered. But if your a dealer selling for example VW transporter vans, which are being customised for mainly camper conversion potential etc. most of their client base is going to be private buyers who are not vat registered and cannot claim it back. So most private buyers are not going to buy something which feels like an inflated price ?!

stockcar

its the LAW so the dealer and purchaser have no choice...........

IdonthaveaScooby

Every 2nd van round here seems to be camper “conversion “

sure looks like a business to me