VAT Relief for a disabled person

clabcom

Hello I am new to these forums, only found out that they existed!

My sister is unfortuntly a quadraplegic and is permantly wheelchair bound. She has bought new cars before from dealerships with the 17.5% VAT relieved from the purchase price.

However, she is now looking to buy a second hand car that cost about £30K new and the main dealer is asking for £20K. Obviously, I would think that the main dealer would have bought this car for less, say £17K? But lets say my sister purchases the car for £20K, then would she get VAT relief in this situation, and if so how much VAT relief? (The car was purchased new inc. VAT by a private owner)

I have heard something about selling the car on a margin scheme on the customs VAT notice for disabled vehicle users in section 4.2?? but don't have much of an idea about it. I would be grateful if one of you could help me, because its almost as if disabled people are being discriminated into buying new cars.

DavidHM

I'm not sure about the VAT situation although at a guess, if VAT is payable on the dealer's margin on the car, she could claim that element back - although how you get the dealer to reveal his profit margin I have no idea.

An alternative would be to find an ex-rental, VAT qualifying car (if one is available) from a supermarket or main dealer on which full VAT would now be payable. The car might be cheaper in the first place and you would hopefully be able to claim back the VAT on the full amount of the purchase price, without the dealer having to reveal how much he had paid for the car.

peterg1965

Hello, I was under the impression that VAT is only levied on brand new cars. Second hand, pre owned, cars are not subject to VAT. Therefore there is nothing to claim back on buying a used car. The only negotiating point is the dealers margin and that is usually quite big, in most cases the profit margin on used cars is greater than discounted new ones. The term 'VAT qualifying' for used cars means that the car can be purchased or leased for business purposes and the buyer can claim back the VAT element of the lease price back, I am sure that is how that works and VAT qualifying vehicles are those that are not more than one year old and low mileage.

Your sister should also look at the Motability scheme which is good value, most mainstream cars are available on the scheme. I assume she is in receipt of Higher Rate DLA for mobility?