What evidence do you need to reclaim VAT on a van purchased on HP?
My client has bought a brand new van from the local main dealer. It has been financed by the main dealer's finance company on a hire purchase.
Client is due a vat refund this quarter and was subjec to a mini compliance check as a result. He was asked to submit lots of invoices for checking with HMRC before they will release the refund, including the van invoice, which he did. They have said everything except the van invoice is ok..
1. VAT inspector initially said the van invoice was not valid because it says "deliver to XYZ Ltd" on it in the customer box. She threatened to charge penalties for an incorrect claim but gave my client 24 hours to get it sorted. Client spoke to main dealer and they have changed the invoice so it just says "XYZ Ltd" in the customer box.
2. Now today, she is saying that this is still not good enough and the main dealer should not have issued the invoice at all, but it should have come from the finance company.
She has not seen a copy of the hp agreement, but it is quite clearly just a bog standard hp agreement. I don't believe the finance company ever becomes the legal owner of the van, they are just financing it, so in accordance with section 8.4.2 of the VAT guide, I think she is talking xxxx.
The manager of the van main dealer has been on the phone to her today but she is adamant that she is correct.
Has anyone experienced this before? Or should we just continue to shoot s 8.4.2 at her?
I don't recall ever seeing a vat invoice issued from the finance company before where a client purchases something on HP. I think they always come from the vehicle supplier. If she is right then there are many many people getting this wrong...
- Stopping trading and de-registering for VAT 239 6
- Disengaging a client who uses our office as a registered office address 856 24
- SA302 187 3
- Amazon Fees, Sage VAT/Tax code T20? 105 1
- Scottish independence - what happens to HMRC? 1,062 56
- Are HMRC cutting out Agents in tax investigations? 259 2
- Dental practice incorpration 118 1
- Audit rules 154 4
- Go Cardless 268 8
- business entertaining deductibility 134 1
- Self assessment tax arrears 156 2
- R & D 107 3
- Shareholder/Directors termination payments 86 1
- Childcare vouchers and final month payroll Qs 112 2
- Can anybody help withe the RTI end of year process? 171 3
- Payroll software with annual pay period? 160 1
- New Business Registration 220 5
- Hosted email exchange 137 4
- Excel formula for UK corporation tax including losses 154 1
- G P life time allowance 125 3
- Xtuple 502
- Qtac payroll for bureau 336
- Confused - Professional Association a Mutual trader, or not? 281
- Industrial & Provident Societies 277
- Mehjoo 221
- Data transfer from Sage Line 50 to VT Transaction+ 218
- New strategic report 173
- Domain name sale and limited company 159
- South African Government Pension 156
- CIS schemes 151