Autotrader Price Guide

[HKQAC 2]

That's the old way they did it, not anymore.

https://www.gov.uk/government/publications/vat-notice-7181-the-vat-margin-scheme-on-second-hand-cars-and-other-vehicles/vat-notice-7181-the-vat-margin-scheme-on-second-hand-cars-and-other-vehicles#making-your-margin-scheme-calculations

chapter 8.3

boring but a worthwhile read!

[Mark101 536]

On 22/03/2018 at 10:20 PM, HKQAC said:

That's the old way they did it, not anymore.

https://www.gov.uk/government/publications/vat-notice-7181-the-vat-margin-scheme-on-second-hand-cars-and-other-vehicles/vat-notice-7181-the-vat-margin-scheme-on-second-hand-cars-and-other-vehicles#making-your-margin-scheme-calculations

chapter 8.3

boring but a worthwhile read!

Thanks for this HKQAC

The following Chapter 8.4 seems to contradict this, or am I misreading it?

For the avoidance of doubt:

From actual invoice detail BCA - for margin scheme,what do you consider to be the purchase price:

Hammer Price = £5,200 Zero rated

Buyers Fee = £274 Zero rated

Live On Line = £44 + £8.80 VAT

BCA Assured = £33 Zero rated

Total Invoice = £5,559.80

Back in 2003 onwards, I used to calculate Selling Price £6,995 less Hammer Price £5,200 (x1/6) = £299.17 VAT Margin.

Using the information below, what do you consider to be the purchase price (for margin scheme)?

I'm an inch of registering for VAT, so need to get my ducks in a row and cut through the hundreds of pages of information with your help.

8.3 What is the purchase price of eligible vehicles I buy at auction?

Your purchase price will be the hammer price of the vehicle plus charges for services.

The invoice you get from the auctioneer will itemise, for each lot you have bought, the hammer price of the goods and any charges for services (for example, buyer’s premium). These charges must not show VAT separately.

This will be your purchase price for the purposes of the Margin Scheme or Global Accounting, and is the amount that you must show in your stock book. It should be clearly identified on the invoice you get from the auctioneer.

If the auctioneer bills you for any other services, and charges VAT on them separately, you can reclaim the VAT under the normal rules. You must not add those charges to your own Margin Scheme purchase price. To avoid confusion, you may want to ask the auctioneer to provide you with a separate invoice for such charges.

If you are in any doubt about what your Margin Scheme purchase price should be for a vehicle you have bought at auction, you should check with the auctioneer.

8.4 What is an indemnity fee?

When you buy a vehicle at auction, you will usually be charged an indemnity fee. This is a charge which ensures that you will have compensation or indemnity if the vehicle you have bought is later found to have been stolen or to have finance outstanding on it.

You must not include the indemnity fee in your purchase price for Margin Scheme purposes.