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Input VAT recovery

30 July 2013
Issue: 4413 / Categories: Forum & Feedback , VAT

A client has started to work in the engineering design business and has purchased two computer-aided design programs, costing about £4,000 each

I act for a client who over the past year or so has purchased two CAD (computer-aided design) software systems from a computer supplier to enable him to measure jobs efficiently and accurately. The client is in the business of engineering design and the systems cost £4 000 each.

My question is simple: in terms of input tax recovery would the cost of the first system be claimable on his first VAT return under the preregistration input tax rules – he bought it one year before he was VAT registered.

He bought the second system in a VAT period after he was registered and using the flat rate scheme – so can he claim input tax on the basis that it cost him more than £2 000 including VAT?

Query 18 230 – Brunel

Reply from Gardener

Many people in Brunel’s position claim this VAT...

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