Margin Scheme Help

[spodokomodo]

Hello,

I am looking to register for VAT soon as I am approaching the threshold.

I am an antiques dealer and the margin scheme looks the most approriate for me.

I understand that HMRC advise the best way is to keep a stock book, and you simply record the purchase price and sale price for each item, to find your margin price, and VAT margin charge.

However, I recently bought 1 'lot' from an auction house (which is where I get most of my stock) and it contained 32 items. How do I go about recording the purchase and sale prices in my stock book, when I don't have an individual purchase price for each item?

 

[Figurate]

You have to allocate a purchase price to each item in the "lot"
(See VAT Notice 718, para 4.1:
"If you buy a number of items as a single lot but intend to sell them separately, you must allocate a purchase price to each one."

and it's a condition of the standard VAT margin scheme that you must keep a stock book - for the purposes that you mention -to calculate the margin (and therefore the VAT on the margin)

If you cannot keep a detailed stock book, for whatever reason, you might be eligible for the Global Accounting Scheme.
This is suitable if you "buy and sell bulk volume, low value eligible goods, and are unable to maintain the detailed records required of businesses who use the standard Margin Scheme"
(again, more info in VAT notice 718, paras 14-15)

 

[spodokomodo]

Thank you for the info, that is very helpful! Much appreciated.