VAT on loans

[buddyric]

Hi

i always thought that you didnt pay VAT on loans, is this still the case

Or can you, if you describe it as a lease repayment and the description is for IT hardware and software

the reason being is i have a quote come though that says just that and it is purely for a loan

advice appreciated

 

[MyAccountantOnline]

Hi

i always thought that you didnt pay VAT on loans, is this still the case

Or can you, if you describe it as a lease repayment and the description is for IT hardware and software

the reason being is i have a quote come though that says just that and it is purely for a loan

advice appreciated

You dont pay VAT on loans but you could on a lease.

 

[Scalloway]

There are two ways this might work. If you are buying the equipment on HP then you will pay VAT on the cost of the item, credit charges will be exempt.

If you are paying a monthly sum for leasing equipment VAT is chargeable on the rental sum.

 

There are two ways this might work. If you are buying the equipment on HP then you will pay VAT on the cost of the item, credit charges will be exempt.

If you are paying a monthly sum for leasing equipment VAT is chargeable on the rental sum.

This is true. For tax purposes HP and loan are exactly the same; they are money lending and VAT exempt.

A lease is actually defined as providing a service so therefore carries VAT