Claiming VAT on invoices prior to registration

Hi There,

I'm completing the first VAT return since registration and i am currently going through old invoices for my input VAT claim.

I am aware of the 4 year rule on goods and 6 month rule on services.

What I am unsure of is if i can claim things such as car repairs on a vehicle I still own? Is this claimable?
Repairs and items bought for P&M i still own - is this claimable?
What about claiming on my phone bills - surely this falls under the 6 month service rule?

Can anyone advise me please?

Many thanks

 

I would say these all fall under the 6 months rule.

 

I would split the phone bill between private and business use

 

Thanks for your replys.

So the 4 year rule is really for claiming VAT on assets?

 

Bear in mind you can only reclaim VAT on costs incurred to enable you to provide goods and services once you are VAT registered, you cant claim on all invoices just because they are within the time limits.

 

Assets covers a lot of things, intellectual property, debtors, etc. etc. many of which wouldn't get VAT recovery.

The 4 year rule is where you've bought goods, i.e. those things that are purely or primarily physical items. So just to look at the items queried:
car repairs - can I go into Sainsbury's, Tesco, or even Halfords and buy a box of car repair? No - it's a service (you may get some goods as part of the service, they may even be itemised separately, but what you've essentially paid for is a service).

Repairs and Items bought for P&M - will again depend on whether you've bought items and bought repairs or whether it's all part of one supply, so if you bought items and then got someone else to fit them then you've got two supplies, one of goods (4 years) and one of services (6 months). If you've just gone to someone and said "this machine's making a chugging noise can you sort it out" and they've sorted it, then that's a service even if their invoice mentions parts.

So just going back to Halfords, if you've gone in there and bought some bulbs, and they've said 'would you like us to fit those sir' and you've said 'sure why not' then they've made two supplies one of the bulbs and one of the fittings like the P&M example above, where you've bought from one and got another to fit.

The one that always catches people out is 'building services' I've seen lots of businesses who've had an extension done or a major refurbishment, registered for VAT a year later and then been surprised at HMRC's refusal to repay the VAT. Just because a major part of the cost might result in something physical, e.g. an extension, that doesn't mean that you've bought goods. Hopefully if you look at each things and ask yourself whether you went to that supplier because you needed that suppliers items or whether you needed that suppliers skill. So if you wanted a house built would you be going to Jewson's and asking them for a house, or would you be going to Taylor Wimpey and asking them (also the word 'built' probably gives it away, if there's a verb in it it's probably a service!)

 

Thank you for this explanation.

Going back to car repairs based on what you have said. If i have purchased wiper blades and fitted them my self (i still own the vehicle at date of registration), this is classed as goods and under the 4 year rule i can claim it?

 

If the same wiper blades are still on the car then I would say you could.