Sole trader, not VAT registered, needs van.

[J.D. Landscaping]

What is the best option available to us ?

We could probably spend around £3k on a 2nd hand one, but I would like to know the options available to us.

We may, depending on the outcome of a tender have to become VAT registered from april, will this change things relating to my options ?

Also, what tax benefits should i expect buying 2nd hand, if i go down that route ?

Many Thanks

J.D

[Jaykay]

Hi and hope all goes well with the contracts.

If you need to finance the van then you could have a bank loan or HP from a finance company. Look at the total cost of borrowing before you decide which route to use.

You can buy the van from somebody who is not VAT registered and not pay VAT on it. Or you could buy the van from somebody who is VAT registered in which case you will be charged VAT.

If you then become VAT registered, you can claim back the VAT on any assets on hand at the date of registration which were purchased within the previous 3 years.

As far as tax is concerned, you normally would only claim a percentage of the cost each year. At the moment, you can claim 100% of the cost of the van in the year of purchase.

Cheers.