VAT qualifying car - how does it work?

wilpert · 26 Jun 2018

I looked at a potential car for Mrs Wilpert.

I didnt give a lot of attention at the time but it is VAT qualifying.
Im a limited company but not VAT registered, although I have a close connection, with a company that are VAT registered, I sub contract work from them and have done for over 25 years.

So is there a way of obtaining the car and saving plenty of money or is this a dream that would end in the tax man feeling my collar?

Alex · 26 Jun 2018

Yeah - get VAT registered.

911tom · 26 Jun 2018

Unfortunately 'VAT Qualifying' will mean that there is 20% VAT to go on the sale price. Unless they have included it already and are simply advising that there is VAT on it. Company cars have been so highly taxed now it is mental. In fact even if you pay company car tax you will likely only be able to reclaim a proportion of the VAT unless it is fully justifiable that you use the vehicle wholly for your business. As in you are a taxi driver, driving instructor etc.

If you become VAT registered and reclaim all the VAT that is up to you... No body will check it, unless you have a VAT inspection. Then you'd better practice your excuses. Unless you can fully justify it I would advise against reclaiming the VAT.

For the car to be VAT qualifying that would imply the previous owner claimed the VAT when it was new. I'd like to know who owned it if that was the case. If in the case of a 911 it is highly possible it belonged to a track experience style place or similar hard part to life.

Alex · 26 Jun 2018

I'm guessing if it's for Mrs Wilpert it's more likely to be a Chelsea Tractor.

wilpert · 27 Jun 2018

alex yates said:
I'm guessing if it's for Mrs Wilpert it's more likely to be a Chelsea Tractor.

Tis an Essex Tractor :hand:

Of the Ongar Persuasion - have a buthcers - youll need dark glasses 8)

http://www.imperials.co.uk/used-car...gate-grey-metallic-automatic-diesel/id-41372/

Alex · 27 Jun 2018

8) :grin:

wasz · 27 Jun 2018

does it not just mean it was last owned by a business that claimed the vat back?

usually things like vans and pickups

but they can also do it on cars, e.g. if its a pool car wholly and soley used by the business, or a wedding car hire car etc.

or a director on the fiddle... honest guv it is a pool car everyone drives it, never goes home, honest.

mikeluke · 27 Jun 2018

As wasz says... it is more complicated than just getting the VAT back. There will be an assumption that a percentage of the usage will be for personal and not just company business and therefore not all the VAT will be due back. If you try to get the 100% they will be wanting to know where it is kept overnight etc etc

I looked at it (self-employed, company director, VAT registered) and decided it was far too complicated to buy a car. The VAT aspect of leasing is easier (you get 50% back easily - can push for more)

Alex · 27 Jun 2018

You could just pay your way like everyone else :dont know:

mikeluke · 27 Jun 2018

:?:

There is that....

wilpert · 27 Jun 2018

alex yates said:
You could just pay your way like everyone else :dont know:

prefer not to.

Alex · 27 Jun 2018

Nobody likes paying tax but it's gotta be done.

mark pearce · 27 Jun 2018

Most VAT qualifying cars are ex leasing company.
the advantage for the leasing co is they can reclaim the vat and "borrow' a lower figure to buy the car that they then rent to the driver and the rentals are plus vat.

The lease co can reclaim the vat then when they sell the car the final price included vat which a vat registered 'company can reclaim" if they so wish

The next owner it makes no difference to if he's not vat registered.
if you are vat registered, you can reclaim the vat, if the car is used for a legitimate business purpose, or the vat man doesn't notice, if your a limited company the car would / could insure company car tax,

Most vat qualifying cars are advertised to attract export enquiries, if the cars exported to say, Cyprus, Malaysia Hong Kong the exporter can reclaim the vat.

the cynic in me says avoid VAT qualifying cars as they are ex company / lease cars and most co car drivers treat their cars differently than if it was there own

wilpert · 27 Jun 2018

hello Mark,

pm'd you

mikeluke · 27 Jun 2018

alex yates said:
Nobody likes paying tax but it's gotta be done.

As the old saying goes.. Only 3 certainties

Life, death and taxes!

VAT qualifying car - how does it work?

wilpert

Indianapolis

Alex

Nordschleife

911tom

Mugello

Alex

Nordschleife

wilpert

Indianapolis

Alex

Nordschleife

wasz

Paul Ricard

mikeluke

Mugello

Alex

Nordschleife

mikeluke

Mugello

wilpert

Indianapolis

Alex

Nordschleife

mark pearce

Singapore

wilpert

Indianapolis

mikeluke

Mugello

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