Re: VAT on second-hand goods...

["graham_howe" <graham@xxxxxxx>]

--- In ukha_d@y..., "Kenneth Watt" <kennwatt@b...> wrote:
> And the killer is that if the VAT man charges you VAT when you buy
the
> goods in you are obliged to add VAT on the way out IIRC.
>
> K.
>

To be fair, if you are VAT registered then this is reasonable isn't
it? After all, if I charge my clients VAT, then I have to pay that to
C&E, I can offset any VAT on purchases. All ths process is doing is
ensuring that it is the end consumer that pays the final VAT, after
all it is a 'Sales Tax'. Because the end consumer is usually not VAT
registered, eventually VAT is paid and not reclaimed, but any
profitable VAT registered individual or company in the supply chain
will only have to pay the net VAT, in other words 17.5% of the
difference between the cost of inputs and the revenue from outputs.
If you were allowed to reclaim VAT on purchases and then not charge
VAT on sales then C&E would lose out.

Regards

Graham

P.S. The only advantage with me being out of work for so long last
year is that I have had three quarters of actually being a net
claimer of VAT, it really is nice to receive the odd cheque from C&E.
The downside is that next year I am unlikely to remain VAT registered.