VAT on Vehicle Excise Duty on a Personal Lease Contract Car?

kelwalker

I have a Personal Lease Contract electric car with ALD Automotive. The recent imposition of £195 VED (Road Tax) on electric cars means I have to pay this amount to ALD Automotive.
Thing is, ALD have added VAT to the £195 VED charge.
VAT is not chargeable on VED  in normal circumstances and I'd be surprised if HMRC imposed any VAT Input tax to ALD Automotive.
Any thoughts/ideas?

la531983

Yes it's accurate, it happened to me and they actually put an explainer on the invoice.

If you search my previous posts you may find the thread.

la531983

Forget that ive found it

https://forums.moneysavingexpert.com/discussion/comment/81344073#Comment_81344073

This wont be a fight you will win.

born_again

VAT on the service charge of lease co.

facade

It is in that thread, but in a nutshell the lease company is the Registered Keeper and responsible for the tax.

When they pass on the charge to you it therefore cannot be treated as a disbursement (something paid on your behalf) and the whole sum is subject to VAT.

If the V5 was in your name, and they paid the tax for you and then asked you for the money, then it is a disbursement and not subject to VAT. 

https://www.gov.uk/guidance/vat-costs-or-disbursements-passed-to-customers

kelwalker

Thank you everyone! I guess I'll have to cough up!