VAT advice

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jlnfrench

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I have made an offer on a boat and asked for certification that VAT has been paid. I have been told that VAT was not paid as the original purchaser was disabled and had the vessel modified thus making it exempt from tax and exempting future owners in perpetuity. I hadn't heard of this, does anyone on this forum have any knowledge? I would be grateful.
 
Hi there,

It certainly could be correct as at the time of purchase. Some HMRC guidance here:
Get VAT relief on certain goods if you have a disability
and
VRDP10000 - VAT Relief for Disabled People Manual - HMRC internal manual - GOV.UK

To prove this for your boat, you'll need a copy of the original bill of sale, Zero-Rated invoice VAT-exempt invoice and eligibility declaration, all in the name of the original (disabled) owner.

What I can't help with is whether that survives resale, ie your words "exempt in perpetuity". You could ask HMRC.

Edited to correct 'Zero Rated'
 
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Well anyone who is not vat registered , can’t charge vat , but if owned by a broker then vat might have to be paid .
 
When a 'Mobo' customer buys a Motorbility Scooter from a Registered Dealer new the 'User' pays no VAT
When He/She sells it on there is no VAT involved. Although the Dealer would have paid VAT when purchasing for Stock
If a 'Dealer' bought the Scooter back into stock used I would think VAT would be attracted in the 'Margin' scheme
if the Boat was purchased New as a 'Motability Boat' (rare thing!!) I would imagine that works similarly
I got involved in the early days of 'Wheelyboats' ie those that a wheechair user can board. That was mid 90's and no vat was attracted/charged to our Charity at the time
Sorry can't explain it any simpler!!
 
jlnfrench said:
I have been told that VAT was not paid as the original purchaser was disabled and had the vessel modified thus making it exempt from tax and exempting future owners in perpetuity.
Click to expand...

Sounds like bollox to me.
Did you notice any modifications?
Ask for written evidence to substantiate this claim.

.
 
(its exempt). ​
I would like to see that said in a French port. ​
If you buy that boat, you owe the vat,
its not exempt, who ever gave you that load of old tosh is taking the hiss,
once you find a liar or bullsh11er, don't deal with them, its the start of things to wrong.
name and shame !
 
Its true that if it was adapted for disabled use it becomes tax exempt for that owner. I am 90% sure that it doesn't carry on for ever. The vat would need paying at the current market price today.
 
Newbroom said:
Its true that if it was adapted for disabled use it becomes tax exempt for that owner. I am 90% sure that it doesn't carry on for ever. The vat would need paying at the current market price today.
Click to expand...
What sort of adaptations does it have , interested .
 
hullabaloo said:
(its exempt).

I would like to see that said in a French port.
If you buy that boat, you owe the vat,
its not exempt, who ever gave you that load of old tosh is taking the hiss,
once you find a liar or bullsh11er, don't deal with them, its the start of things to wrong.
name and shame !
Click to expand...

You say this with no knowledge of the facts. The law allows this scenario. Sure it may be bullsh*t but it's perfectly feasible, and allowable in EU and UK law.
 
Tax rules are deliberately written to be vague and encourage grey areas .The practice is , what’s allowed is more convention in a kinda we will not challenge that behaviour If said behaviour fits the intention of the relief *
If challenged the onus is on the customer to prove they should not pay , not the other way round .
Decisions are often centred around the gov intension of a particular tax rule / law / guidance .
They never are specific with tax law because if they were to draw clear boundaries then folks would have something to work to .
It always boils down to the intention .
In this case the intention was to apply relief to disabled.

So if you don’t qualify as the intended recipient of the relief ......no chance inho of winning a revenue challenge.

* so an example was film relief .
Gordon Brown to boost British film industry gave 100 % relief if you invested in GB films .
Intention was at the time was to boost the U.K. film industry , from investors who's day jobs were in film s etc genuinely interested in boosting U.K. films .
What actually happened was others ( badly advised ) dived in .....ex footballers, etc .3rd parties set up “ film schemes “ Put in £100 K borrow say £900 K , thus gain ££1M relief going Fwds which would pay for the interest on the borrowed part .

When challenged , they failed and had to repay etc because .
Although technically what they did was not unlawful ie correct was it the right intention ? It intention was for the likes of Michael Cain , Sam Mendes et al to generate cash not a ex foot baller .
The folks it was not intended for did not attend meetings , scrips , sets , shows , or contributed in any way what so ever to the “ film “ ...........they just used it to mitigate tax .Nothing stopped them .There were no exclusions , as I said vaguely written up .

But when challenged the revenue just played the “ intended “ card and @ the high court they all lost there case .
Genuine film makers were left alone unchallenged.

So back to this unless you genuine fall into the intended VAT relief groups.....then nope .
 
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But that's not the same case. This is a case that exists in UK VAT law. Assuming as the OP stated that the original supply was legally Zero Rated for VAT exempt on the grounds of disability adaptation, the only unanswered Q is what happens on resale.

Edited to clarify zero-rated
 
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No modifications that I could see, but was only told of situation after I had viewed and made an offer. I have decided to walk away. Thank you all for your help and advice.
 
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