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Ten out of ten

27 March 2012 / Neil Warren
Issue: 4347 / Categories: Comment & Analysis , VAT
NEIL WARREN celebrates a decade of the VAT flat-rate scheme by looking at unlikely opportunities to claim input tax

KEY POINTS

  • The flat rate scheme is ten years old: are you suggesting it to clients?
  • An important rule for capital goods costing more than £2 000.
  • But no claim for capital goods that are leased let or hired.
  • Ensure claims are made for pre-trading expenditure.
  • Output tax applies where assets have been subject to an input tax claim.

Here’s a VAT poser for you: a small business let’s say a limited company is buying a portable office unit from a supplier which will reside in the back garden of the director’s home.

It will cost £10 000 plus VAT and will be used 50% of the time for company business; the other usage will be for private Facebook activity by members of the director’s family.

Is...

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