Selling a van

Suarez

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.

zygurat789 wrote: »

You obviously do not understand how to operate VAT

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

You haven't a clue. Nowhere on your link does it say about transferring to another legal entity. Way off pal, way off!

Savvy_Sue

Suarez wrote: »

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!

I cannot comment on the quality of the information provided here, but the advice to ask your accountant is DEFINITELY the right answer.

Suarez

Can you please show me on the HMRC website where it says this...

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.

zygurat789

As per the link previously posted.

Accounting for VAT when your registration is cancelled
When you cancel your registration, you must account for VAT on stock and certain assets you have at the close of business on the day your VAT registration is cancelledAccounting for VAT when your registration is cancelled

.

This means that VAT ie output tax has to be paid on these items, as if you had sold them. The non-vat registered trade which has in theory purchased these items will record them at the new cost being VAT inclusive.

CathyP72

Definitely not illigal.

purdyoaten

Question 17 on de-registration form??

http://www.hmrc.gov.uk/forms/vat7.pdf

See7 : Business assets and Stock on Hand

http://customs.hmrc.gov.uk/channelsPortalWebApp/channelsPortalWebApp.portal?_nfpb=true&_pageLabel=pageVAT_ShowContent&id=HMCE_CL_000087&propertyType=document#P320_19396

motorguy

zygurat789 wrote: »

Maybe not legally

My accountant did it for me, and i suspect he knows what hes talking about.

Although motor traders are on a VAT margin scheme, so we only pay VAT on the gross profit margin, so that would clearly impact the figures.

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.

As opposed to telling us we're wrong - can you show us clearly where it says you have to sell all your assets to a non vat registered entity?

The actual VAT registration cancellation form actually says "You may have to account for VAT on these assets on your final VAT return." - it mentions nothing about creating another entity.

Lets be honest, what its really saying is, "if you claimed VAT back when you've bought it, if you have stock remaining when you deregister, you'll owe us the VAT on its value."

zygurat789

motorguy wrote: »

My accountant did it for me, and i suspect he knows what hes talking about.

Although motor traders are on a VAT margin scheme, so we only pay VAT on the gross profit margin, so that would clearly impact the figures.

But only on the sale of motor vehicles.
Deregistration is more about VAT you have already claimed as input tax.
If your accountant did it for you then you really don't know or understand all the detail behind such a procedure or you would have done it yourself.

motorguy

zygurat789 wrote: »

But only on the sale of motor vehicles.
Deregistration is more about VAT you have already claimed as input tax.
If your accountant did it for you then you really don't know or understand all the detail behind such a procedure or you would have done it yourself.

Rather than criticise semantics, why not show us where it says you have to create another non vat registered entity?