Claiming back VAT on rent

Claiming back VAT on rent

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Hi,

I have taken out a lease through my LTD company and will sublet it to my partnership which we will use for trading. I was advised to have two separate entities, one for the rent payments and the other for trading, this is in case the business didn't work out then our risk is limited.

However the landlord is charging VAT on top of the rent, is it possible to claim back this VAT through the LTD company as it's only activity is making payments to the landlord. Or do I need to register my partnership for VAT in order to recover my VAT?

Thanks.

Replies (2)

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chips_at_mattersey
By Les Howard
26th Aug 2013 20:25

it depends ...

Is the partnership making taxable supplies?

If so, then you can register the company for vat, and opt to tax. This will allow the partnership to recover the vat, and also perhaps to generate some profit in the company.

 

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By PKan
26th Aug 2013 22:58

They would both need to be vat registered for the partnership to get the vat benefit. This is assuming the ltd invoices the partnership for the rent. The ltd vat position will be zero as it will invoice at no profit, I assume (again, dangerous but hey) the partnership only pays out so it will receive the vat benefit.

As a matter of interest is it an llp or just a partnership agreement? 

 

 

 

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