Input tax ― buying and leasing cars and other vehicles

Produced by a Tolley Value Added Tax expert

Value Added Tax

Guidance

This guidance note looks at the rules for recovering VAT when purchasing and leasing cars or other vehicles. In particular, it looks at the input tax ‘block’ that applies to many cars. It also covers the VAT consequences that arise when a vehicle is put to some private use or where it is purchased and then subsequently sold by a business.

The recovery of VAT on motoring expenses (eg fuel costs and the charging of electric vehicles) is covered separately in the Input tax ― motoring expenses guidance note.

For an overview of input tax more broadly, see the Input tax ― overview guidance note.

For in-depth commentary on the legislation and case law in this area, see De Voil Indirect Tax Service V3.443.

Basics of input tax recovery on cars and other vehicles

There is a specific input tax block which applies to the supply of a car to someone who is VAT registered (or required to be VAT registered). The effect of this is that VAT is

Continue reading

To read the full Guidance note, register for a free trial of Tolley+™

TAKE A FREE TRIAL

Popular Articles

Value Added Tax

Reverse charge ― buying in services from outside the UK

Reverse charge ― buying in services from outside the UKThis guidance note covers the reverse charge that applies to services that have been bought in from outside the UK. For an overview of VAT and international services more broadly, see the International services ― overview guidance note. For

15 Dec 2020 14:02 | Produced by Tolley Read more

Value Added Tax

Supplies of goods and services connected with education

Supplies of goods and services connected with educationThis guidance note provides an overview of the VAT treatment of goods and services provided in connection with supplies of education. This should be read in conjunction with the following guidance notes:•Supplies of education•Local authority

14 Jul 2020 13:44 | Produced by Tolley Read more

Employment Tax

Income tax paid on behalf of employee

Income tax paid on behalf of employeeIntroductionEmployers may wish to make payments of employment income to an employee / director without the employee suffering a tax or NIC cost on that pay. In other words, the employer wants to pay an amount net of tax and NIC. In some instances, often with

14 Jul 2020 11:58 | Produced by Tolley in association with Paul Tew Read more

��Ƶ