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05 April 2016
How does the capital goods scheme legislation apply to multiple assets?
A client purchased 20 acres of land for £233 000 and after development has operated a horse livery and training business making taxable supplies. The land was not subject to an option to tax. The business was registered for VAT voluntarily because turnover is below the threshold. The following capital expenditure was incurred and the VAT input tax recovered is shown in brackets where applicable.
- A dwelling house was constructed the supply was zero-rated.
- A dressage arena and training school cost £46 000 (£9 200).
- A stable cost £150 000 (£30 000).
- A store and building cost £80 000 (£16 000).
- Fencing and walls at a cost of £62 500 (£11 000).
- Other costs including landscaping and access roads of £188 300...
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