The tax point for separate delivery is the date of payment of interest. If the payments contain an item attributable to the credit, it means that a tax point occurs at each payment receipt. It is recognized that some providers may have difficulty isolating credit charges when the agreement provides for a fixed interest rate. Under these conditions, a housing tax centre may be appropriate (see VATTOS6300). HMRC believes that a company that provides property at the time of the lease-sale should be allowed to collect upstream vat recoveries on its overhead costs if the recovery is fair and reasonable. It does not follow that the recovery will simply be fifty-fifty. The recovery rate depends on the nature of the lease and the specific rules available. On the other hand, a lease-sale agreement would constitute a property supply agreement in which the exercise of the option to purchase would be the only economically rational choice, for example. B because the sum of the payments already paid corresponded to the total cost of purchasing the goods on the financing. In these cases, at the end of the life, VAT was deducted from the total cost of delivery. The vehicles are a little different.
For commercial vehicles purchased under a rental agreement, you receive the full VAT (100%) on purchase, but NOT on monthly payments. Leases differ by claiming the full VAT on monthly payments and not the purchase. That`s the difference. The point of the property tax for delivery to the customer is, in most cases, the date of delivery or withdrawal of the goods. If there are two deliveries (for example. B to and by a financial company), this is the tax basis for the delivery of the customer by the financial company. The point of the property tax for delivery to the financial company is usually made on the date the goods are made available to the financial company. Unless the agreement is otherwise stated, it may be the effective date of the financial agreement, possibly on the date it was signed by the last party. You claim VAT refund on a rental purchase on your next VAT return. This is quarterly or monthly if you have been registered for 12 months or more.
You can normally collect VAT on a rental purchase up to 4 years after signing the contract. In the context of a rental agreement constituting the provision of “services”, VAT is due on each monthly tranche, while in the context of an ordinary rental contract constituting the delivery of “goods”, VAT is levied on the handing over of goods at the end of the period, the taxable base being the total price of the delivery. In both cases, VAT obligations arise from the Council`s 2006/112/EC Directive (the VAT Directive). Under the judgment of the Court of Justice in the Mercedes Benz Financial Services (MBFS) C-164/16 (see VATSC10172), certain contracts that may be called lease-sale contracts are processed for VAT purposes, which are considered rental and service transactions (not as deliveries of goods and separate delivery of credit). This is the personal purchase of contracts (PCPs) or similar agreements for which the contract provides for an optional material payment.