Up until the end of March 2015, one of my Second Hand car dealer clients was charging some of his customers for warranties (VAT Exempt).
He would pass the premium onto the insurance company and would pay IPT to them.
From 1st April however the insurance company no longer charge him IPT but VAT.
Has something changed in legislation that I have missed? Does this have implications for his treating the "sale" of the warranty as VAT exempt?
Replies (3)
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718/1 starting position re your client's sales
Section 9 needs to be read re your client's treatment of their sales to check what circumstance prevail, cannot comment on the sale to your client by the insurance company, sorry.
https://www.gov.uk/government/publications/vat-notice-7181-the-vat-margi...
Car Warranty
Yes, he does need confirmationform the provider of the warranty. With the IPT burden some have already moved to non-insurance products.