07 February 2007
Our prospective client has set itself up as a UK limited company and has acquired a luxury ocean-going yacht which will be used for commercial charter, thus incurring a significant amount of input VAT.
If the company registers for VAT, we are assuming that it can reclaim this VAT in the normal way. However, we are somewhat unsure of the treatment of outputs. Does this depend on whether the boat is chartered outside UK waters, European waters, both or neither?
Furthermore, what of the input VAT, which the company is likely to incur on its ongoing costs?
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