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New queries, issue 4240

26 January 2010
Issue: 4240 / Categories: Forum & Feedback
Care home owners’ VAT repayment claim; buying out spouse’s shares in company; pre-letting expenses; does split year treatment apply?

Care home tax

Mr and Mrs B owned and operated a residential care home (with minimal nursing care provided) as a partnership between 1992 and 2004 when the business was sold as a going concern.

Between January 1999 and March 2002 they spent £500 000 plus VAT on property refurbishment costs and £800 000 plus VAT on extensions and other capital improvements to the premises.

A VAT repayment claim on Kingscrest principles appears feasible and readers’ guidance would be welcome on the following points.

First is there any official HMRC publication detailing their official view on such Kingscrest claims?

Second can we apply for VAT registration to take effect from a specific date later than the start of trading in 1992?

Between 1992 and 1999 minimal input tax was incurred by the business and most residents were self-funded meaning that recovery of output tax on...

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