2 accountants 2 different storys

[hazzard a guess]

I wonder if someone could shed some light on this
I leased a van back in 2007 (the sort of deal where after 3 years I had to sell it to a 3rd party) – I did sell it to a mate and bought it back ( so no money changed hands and no change of keeper on the log book) – it was just to keep the finance company happy .
And I paid them the 9k for the van back in September 2010 – I wasn’t vat registered at the time so therefore couldn’t claim back the vat (obviously)
However I went vat registered in May 2011
The question is this
One accountant has told me that I can now claim the vat back on all plant purchases such as machines that I use and the van – which would be lovely and a nice bonus
But the new accountant that I am thinking of appointing has said – when you sell the van you can keep the vat – so if your van is now worth 6k – you can keep all the 6k and dont have to charge vat ( which I dont think is right somehow as I charge vat on everything I do)

Who is right
Many thanks
lee

 

[simon_misiewicz]

If you are VAT registered then you will need to charge VAT no matter when it was purchased.

I have included some details here for you to look at

hmrc.gov.uk/vat/managing/reclaiming/motoring.htm

 

[hazzard a guess]

cheers simon

 

[alwaysinamess]

Just to add a bit of Spice having been in a very similar situ but as a LTD company, if the owner is Vat Registered and a sole trader then yes he would have to, but if the company was Ltd and Vat Registered and the van was not owned by the company then he wouldn't have to add VAT as it would not be owned by the company no ?

 

[David Griffiths]

Are you continuing to be VAT registered? If that's the case, then you will have to account for output tax if you sell the van.

If, on the other hand, you are going to deregister from VAT, then the advice given by the second accountant might be right. Normally when you deregister you have to pay VAT on stock and assets such as tools or vehicles that are in your possession at the date of de-reg, if you have claimed VAT on them in the first place.

However, if the total value (not just the van or any individual piece of kit) is less than £6,000 then you don't have to pay this VAT.

As always with VAT it all depends on the full facts of the story, and the exact position would dictate what happens

 

[hazzard a guess]

thanks for your help here - but i am unsure still ?

i am ltd and i am vat registered - i am still in business and no intension of going out of business or dereg from the vat.

so to cut to the chase can i claim back £1351.06p from the £9071.42p bill i paid (17.5 % tax then) all thouugh at the time i paid this i wasnt vat registered - but now i am and i am still using the same van.

and when i sell the van it will be for whatever + Vat

cheers in advance for your help

 

[David Griffiths]

Yes - you can claim on any assets - stock or equipment - that you purchased in the four years before registration, still have at the date of registration and for which you hold a valid VAT invoice.

On the van, that would mean that the mate that you sold it to was VAT registered and issued an invoice.

If you can claim the VAT on the van, then yes when you sell it the price wll include VAT

 

[alwaysinamess]

If your ltd, you cant be VAT Registered only the company can, so if the van is in your name and not the business then you can sell it as it is with no Vat, as that has already been dealt with either way whether right or wrong, its not a issue for now.

 

[David Griffiths]

If your ltd, you cant be VAT Registered only the company can, so if the van is in your name and not the business then you can sell it as it is with no Vat, as that has already been dealt with either way whether right or wrong, its not a issue for now.

If the van is in his name and it's the company that's registered, then he can't reclaim the VAT in the first place.

 

[hazzard a guess]

the van is in my company name