Ducati Sporting Club UK > General > Idle Chat > IT Contractor's - VAT registered?

[Ozz]

I tell my clients not to bother. Yes you reclaim the VAT. You then get hammered twice:

1. You have to pay back VAT on a notional benefit in kind quarterly, and

2. The tax man gets a benefit in kind (along with 12.8% employers NI contribution).

You won't win! Not sure what would happen when you sell. Only VAT is charged on commercial vehicles so would think no charge.

[Ian Harris]

Originally posted by Ozz
Not sure what would happen when you sell. Only VAT is charged on commercial vehicles so would think no charge.

It wouldn't surprise me if you didn't have to pay the VAT when you sell the bike...I always had a sneaking suspicion that my accountant was working for HM Customs and Excise and not me !

[Ozz]

Shouldn't do as it would come under the second hand goods scheme. You would only then pay VAT on the profit margin.