Change to VAT on Warranties?

Change to VAT on Warranties?

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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? 

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paddle steamer
By DJKL
12th Apr 2016 15:15

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...

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chips_at_mattersey
By Les Howard
12th Apr 2016 21:44

Car Warranty

Yes, he does need confirmationform the provider of the warranty. With the IPT burden some have already moved to non-insurance products.

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By Precision
14th Aug 2017 08:45

Posted in error

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