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I act for a client who is a sole trader carpet fitter and owns the freehold of a retail shop. He uses part of the ground floor to display his carpets and rents out the other half and the first floor to separate businesses. He charges VAT on the rent because he opted to tax the property five years ago.
My client wants to deregister from VAT because his total income – rent plus carpet sales – is less than £83 000 each year. He will account for output tax on his final VAT return for the market value of his stock and his van but my question concerns the property which is worth about £240 000.
As I understand it he only needs to account for output tax on his final VAT return if he claimed input tax when he purchased it. He didn’t claim input tax...
