Reclaiming VAT on business item purchased personally

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DuaneJackson

DuaneJackson

Free Member
Jul 14, 2005
8,642
1,100
Brighton / London
  • #1
    I want to buy a laptop that costs about £1200 + VAT. We don't have the cash in the company at the moment to pay for it outright and it's difficult to get 0% finance as the limited company.

    However, I can get it myself on 0% finance form a retail outlet. Is there any way I can buy it myself but still be able to have the company pay the installments, and more importantly reclaim the VAT?
     
    L

    LindseyMHC

    Free Member
    Aug 28, 2005
    247
    2
    Ashtead, Surrey
  • #2
    Hi Duane,

    I bought a PC for my company last year, but paid for it personally as the company didn't have the money at the time - like you.

    The money I paid was classed as a loan to the company and when the company had the money I was repaid (in installments) which were classed as 'loan repayment' in my accounts. I could still claim the VAT.

    Any accountants on this forum will obviously tell you whether this is the right way to go about it, but my accountant has just done my first year's accounts and said everything was OK with the figures.

    Hope this helps.

    Lindsey.
     
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    Alpha

    Alpha

    Free Member
    Feb 16, 2004
    3,192
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    West Midlands
  • #3
    Duane

    There are a couple of points to consider.

    1) By buying the Laptop yourself and then the company pays you this is technically a BIK and needs to be reprted on a P11d.

    Practically very few people do this but if you get a stroppy inspector they can obviously point out that the P11d is incorrect which comes with a fine of up to £3000. I personally have not heard of anyone getting that level of fine yet (and I have just got a repayment of over £1000 back of the revenue because the company only put the 2 most expensive cars on his P11d whereas he had 5 during the year in question)

    2) Again by buying the laptop the supply is made to you personally. You are not vat registered therefore cannot claim the vat back. As the vat supply is not made to the company neither can the company.

    There was a customs concession which allowed the company to reclaim vat back on purchases made on behalf of the company by an individual but this was challenged in the European courts late last year. However I have not received any official notification of HMRC changing the concession yet.

    On this point I will have to do some research and get back to you.

    Can you not personally guarantee the loan on behalf of the company?
     
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    A

    annethedonn

  • #4
    I purchased a laptop for my business 1 year before I started it along with many other items and put them down on my director's loan account. I claimed back the VAT - I think you can go back 3 years or so. My accountant did all this for me.

    Duane, why don't you ring my accountant Iain Goodhew, or Beccy (she's the VAT expert) 01252 519595 - they give free advice to potential customers (Iain spent half an hour explaining everything before I decided to use the company - Jones & Co).
     
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    Alpha

    Alpha

    Free Member
    Feb 16, 2004
    3,192
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    West Midlands
  • #5
    Cannot find any recision so by all means go ahead and purchase it and reclaim the cost on an expenses claim form.

    Obviously if the invoice for the equipment is made out to the company and the finance form is made out to you personally then it is absolutely no problem at all.

    :)
     
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    autolycus

    autolycus

    Free Member
    Mar 4, 2005
    255
    0
    Brentwood, Essex
  • #8
    Alpha said:
    1) By buying the Laptop yourself and then the company pays you this is technically a BIK and needs to be reprted on a P11d.

    Practically very few people do this but if you get a stroppy inspector they can obviously point out that the P11d is incorrect which comes with a fine of up to £3000. I personally have not heard of anyone getting that level of fine yet (and I have just got a repayment of over £1000 back of the revenue because the company only put the 2 most expensive cars on his P11d whereas he had 5 during the year in question)
    Click to expand...

    The way I normally deal with this kind of thing is to declare it as a BIK on the P11D and then claim it back on my self-assessment form as an expense incurred for business purposes. Net result is the same as not mentioning it anywhere at all, but keeps everything squeeky clean int he eyes of HMRC.
     
    Upvote 0
    F

    fastfences

  • #11
    DuaneJackson said:
    Yep, we use Dell for our servers. I don't like their laptops. The Latitude X1 looks nice but I've never been impressed with their build quality or after sales service.
    Click to expand...

    Very interesting. I'm on the verge of buying one, but not in the 'top end' of the market. Have you had a bad run with Dell, or is your opinion based on 'feedback' from others?
    cheers, Nigel
     
    Upvote 0
    B

    BMS

  • #12
    Interesting.........

    I have a dell PC and laptop and never had any issues, there was a thread on here recently discussing Dell maybe you should check it out.

    Having said that PC's / laptops are like cars....it's done to personal preference.
     
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