Selling a van

jewls

Hi

I am a limited company and I own two vans, I want to sell them both for a new van as my bigger van is 10 years old and got problems

Firstly one van was bought when I was not registered for vat second one was, I have since deregistered for vat

I want to put all of the money I get for them towards a new van

Question is will I be doing anything illegal

Many thanks

phill99

How can selling a van and buying another one be illegal?

zygurat789

jewls wrote: »

Hi

I am a limited company and I own two vans, I want to sell them both for a new van as my bigger van is 10 years old and got problems

Firstly one van was bought when I was not registered for vat second one was, I have since deregistered for vat

I want to put all of the money I get for them towards a new van

Question is will I be doing anything illegal

Many thanks

When you deregistered from VAT you ought to have, in theory, sold all your assets from the VAT registered entity to the non VAT registered entity thus creating a VAT liability which ought to have been paid in your last VAT payment. So long as you have done this you are legitimately outside the VAT net so no problem in doing what you want.

Aquamania

jewls wrote: »

Hi

I am a limited company and I own two vans, I want to sell them both for a new van as my bigger van is 10 years old and got problems

Firstly one van was bought when I was not registered for vat second one was, I have since deregistered for vat

I want to put all of the money I get for them towards a new van

Question is will I be doing anything illegal

Many thanks

When your company bought the first van, there was presumably vat to pay (assuming it was sold by a vat registered seller). Your company was unable to recover that vat as it was not registered for vat.

When your company bought the second van, there was presumably also vat to pay (assuming again it was sold by a vat registered seller). Your company was able to recover that vat as it was registered for vat at that time.

Your company has since de-registered for vat, when you come to sell the vans, you are unable to add vat to the sale price (as your company is no longer registered for vat)

Commercial vehicles are usually priced (by vat registered sellers) as price plus vat. If you are not registered for vat, you cannot add it.

So unless you find a small, private buyer who is not registered for vat themselves, you'll only get the basic value of the vehicle less the vat.
(and even if you do find such a buyer, they may be loathe to buy it at an increased price, just because you won't add any vat)

When your company buys a new van, presumably it will be from a vat registered business, so your company will pay the vat on it (and will not be able to recover that vat either).

Assuming your company's de-registration from VAT was all above board, and the new van will also be in the company's name, I can't see how you are doing anything wrong? :huh:

Aquamania

zygurat789 wrote: »

When you deregistered from VAT you ought to have, in theory, sold all your assets from the VAT registered entity to the non VAT registered entity thus creating a VAT liability which ought to have been paid in your last VAT payment. So long as you have done this you are legitimately outside the VAT net so no problem in doing what you want.

What are you on about? :huh:

First time I've ever head of any requirement, in theory or otherwise, for a legal entity to sell all it's assets to another legal entity just because it decides to (lawfully) de-register from vat.

There is only one legal entity here, that of the OP's limited company.

motorguy

zygurat789 wrote: »

When you deregistered from VAT you ought to have, in theory, sold all your assets from the VAT registered entity to the non VAT registered entity thus creating a VAT liability which ought to have been paid in your last VAT payment. So long as you have done this you are legitimately outside the VAT net so no problem in doing what you want.

Eh?

All thats happening when you de-register is you no longer collect VAT on services or goods sold.

I deregistered for VAT when ramping down from full time motor trading to part time so have been through it.

Savvy_Sue

And if you have an accountant, I'd definitely ask them!

bris

When you de register you must fill in a final VAT return, any company assets that had vat claimed back on need to be in that return so you can give the VAT back on its current value.

So when the OP deregistered the van that the vat was claimed back on should have been subject to vat with the VAT paid back at it's current value. De registering doesn't get you off with your liabilities.

zygurat789

Aquamania wrote: »

What are you on about? :huh:

First time I've ever head of any requirement, in theory or otherwise, for a legal entity to sell all it's assets to another legal entity just because it decides to (lawfully) de-register from vat.

There is only one legal entity here, that of the OP's limited company.

You obviously do not understand how to operate VAT

http://www.hmrc.gov.uk/vat/managing/change/cancel.htm#4

zygurat789

motorguy wrote: »

Eh?

All thats happening when you de-register is you no longer collect VAT on services or goods sold.

I deregistered for VAT when ramping down from full time motor trading to part time so have been through it.

Maybe not legally

Suarez

My advice is to ask your accountant. There's incorrect information flying about here and no one on this forum will be liable if you make a mistake!