My client owns a farm and is about to undertake some work with another local farm. To undertake this work they have decided to purchase a tractor for £6000 plus VAT. The cost is to be split half and half. I am unsure how to deal with this in terms of who 'owns' the tractor and who claims the VAT etc. Would it be possible for 'A' to own the tractor and for 'B' to have loaned the £3000 to A, the loan then sitting in the balance sheet?Presumably ongoing maintenance costs would have to be done via a gentleman's agreement, with A invoicing B for half of the costs?
11th Apr 2012 11:03