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Ltd provides lease car to sub-contractor

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A limited company has a consultant who does not have their own car. 

the company leases a car and provides this to the consultant to use for business use only.

as the leased car is 100% business the ltd has claimed back 100% vat.

Should there be any charges back to the consultant for use of the car?

is the 100% vat claimable? It is used for the business but just in an unusual circumstance I have not come accross before.

 

any guidance would be appreciated / thank you 

Replies (7)

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By WhichTyler
28th May 2020 20:33

Surely the co should charge the consultant a hire fee that is vatable?

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By Tax Dragon
29th May 2020 06:48

Does the consultant have any other connection with the company, or is the use of the car effectively part of his or her fee?

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By Cheshire
29th May 2020 08:51

Should the s/e consultant really be on the books as an EE?

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Replying to Cheshire:
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By paul.benny
29th May 2020 15:14

Looks like that to me, based on the limited facts.

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By Accountant A
15th Jun 2020 18:31

oug

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By paul.benny
29th May 2020 15:15

Are you sure it's only business use? How does the 'consultant' get to the company premises? Does consultant ever take the car home? Is there a mileage log to support this?

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Replying to paul.benny:
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By Tax Dragon
29th May 2020 15:20

The answer to that may lie with the answer to the question: which business? (Coupled with the answer to my other question above.)

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