VAT on Old Office Kit

[Ozzy]

We usually donate our old IT equipment to local schools, which is fine it the kit is suitable and usable for schools.
However we have half dozen MacBook Pro's, three years old, which are not suitable for the schools as they cannot really use them. So we're selling them at write-down value (depreciated) to several small local businesses.

My question is whether we need to add VAT to the sale. The HMRC guidance is confusing as it talks about only having VAT on the profit, there is no profit.

We are a VAT-registered business.
The purchase price of the MacBook's was ~£2,200 three years ago
We're selling them for £300, which is their value on our balance sheet

 

[DWS]

From what you say I would imagine you need to charge VAT on the sale.

 

[Paul Kelly ICHYB]

Yeh, if you are VAT registered and sell something VATable, I am sure you have to charge it.

 

[UK Contractor Accountant]

The HMRC guidance is confusing as it talks about only having VAT on the profit, there is no profit.

That's the VAT Margin Scheme - used for when you buy secondhand goods from non vat registered entities and then sell for a profit ( predominately used by car dealers). the VAT charged is worked out on the profit element of the sale.

 

[Galactus2024]

We usually donate our old IT equipment to local schools, which is fine it the kit is suitable and usable for schools.
However we have half dozen MacBook Pro's, three years old, which are not suitable for the schools as they cannot really use them. So we're selling them at write-down value (depreciated) to several small local businesses.

My question is whether we need to add VAT to the sale. The HMRC guidance is confusing as it talks about only having VAT on the profit, there is no profit.

We are a VAT-registered business.
The purchase price of the MacBook's was ~£2,200 three years ago
We're selling them for £300, which is their value on our balance sheet

If you analyse your entries you will have recovered VAT on the purchase price three years ago so if you sell for £300 you will need to account for VAT on that sale as that is effectively your "profit".
So as stated by others if its a vatable supply then VAT needs to be charged.