Starting a business and claiming vat back on an asset

Nathanb

Hi the title doesn’t explain properly what I’m looking at doing.

im starting up my own business and need to purchase a vehicle however because my business is brand new I can’t get finance but I want to claim vat back as my business is going to be vat registered.

How do I go about purchasing it personally but putting it into the business and claiming the vat back.
it is going to be 100% for business use so I want it to be a business expense I just need to get the finance personally.
i have asked the dealership if I could do a directors guarantee, but because my business is literally a day old they won’t do.

any help in this would be really appreciated I’m panicking that I can’t claim the vat back and probably won’t be worth me going vat registered. 

neilmcl

As you mention directors guarantee I'm assuming this is a Ltd co. therefore if you have the cash to buy the car then why not make a director's loan to the company then the company can purchase it itself. I would also advise speaking to your accountant to ensure the most tax efficient way to proceed with this.

As far as the VAT is concerned you can generally purchase goods up to 4 years prior to registration as long as the entity purchasing the goods is the one that is VAT registered. Again, speak to your accountant, this is what you pay them for.

Nathanb

neilmcl said:

As you mention directors guarantee I'm assuming this is a Ltd co. therefore if you have the cash to buy the car then why not make a director's loan to the company then the company can purchase it itself. I would also advise speaking to your accountant to ensure the most tax efficient way to proceed with this.

As far as the VAT is concerned you can generally purchase goods up to 4 years prior to registration as long as the entity purchasing the goods is the one that is VAT registered. Again, speak to your accountant, this is what you pay them for.

Thank you. I have my accountant looking into it just in a bit of a rush to buy the van. That would be an option I’d go for but I don’t have the money to do that as it’s a brand new van so need to finance it personally but put it through the business afterwards.

Grumpy_chap

The rules for reclaiming VAT on vehicles is not as simple as just getting all the VAT back. 

Best to check the details with your Accountant, along with BIK liabilities.

This might be a more suitable question for the tax cutting forum than motoring.