Asset disposal where company is subject to partial exemption
Have a general query from a client and not enough time to research whilst filing all those nasty late SA returns!!
My client has significant VAT partial exemption (a golf club).
They are part ex'ing and replacing a significant piece of plant - am I correct in assuming that the allowable % recovery on the original plant (approx 20%) would then mean the same % was the repayable vat on the disposal?
eg original cost £50k plus vat £10k, but input claim restricted via partial exemption to 20% (ie £2k). Now being disposed for £16k to finance company therefore being
£13,333 net and vat of £2,667 vat. Would have imagined the output VAT on disposal would be the same as the allowable % when originally purchased - otherwise they only recovered £2,000 when purchased and then have to pay £2,667 on the disposal!!
Appreciate there may be a simple answer to this and many thanks in advance!
- calculation DTR restriction 65 1
- Company Director In Prison 430 11
- SMP reclaimable by employer 43 1
- AWeb - download file 153 3
- Charity work 226 11
- Help with HMRC investigation 224 6
- Director Drawings 137 5
- Accounts Software 88 3
- Do I need to report this to SOCA 3,673 38
- Subcontractor and CIS Deductions made by Contractor 256 13
- Managing Employee Expenses 218 7
- HMRC Agents Line 177 3
- Collection or business assets 96 1
- Incorporated when they should not have 260 8
- Tax position re this lease? 367 9
- Do I need a smartphone? 717 23
- Is compensation for surrender of a lease subject to VAT 101 2
- Can I take action against my accountant for incompetence? 3,672 70
- IHT 205 partnership and business interests 88 2
- Reasonable excuse for not filing returns....Death? 346 5
- Property exchange - 8-year legal delay following fall-out 673
- Have you staged yet for auto enrolment? 513
- Cancelled 427
- Cancelled 365
- SAGE Payroll Data for Import to MS Dynamics AX 362
- Probiz 335
- Free-standing washing machine - unfurnished lettings 327
- Phishing emails purporting to be from CIPFA? 243
- Is this UK incapacity benefit taxable in UK or Jersey? 215
- Another HMRC computer glitch? 202