Company vehicle for a non trading company...

magda-L

Hi,
I set up a company 5 months ago but it hasn't started trading yet and is not vat registered. It probably won't trade for another few months at least.
I am still an employee of another company where I need my own car for my work and receive a mileage allowance for every mile I travel.
I am thinking of selling my car, loaning some money to my company and buying a commercial vehicle through my company. I won't be claiming vat back on the diesel I use but was thinking of claiming vat back for the vehicle.
Does anyone know if I need to be trading to register for vat, and if there would be questions asked if I sent in my first annual return next month where the only activity of my company was the purchase of a vehicle?

Really appreciate any help on this!
Thanks,
M

magda-L

sorry - have i posted this in the wrong section?

Little Miss Cutie

No your not in the wrong section, think it is just a slow response, lots of us focused on exams.

Yes you do need to be VAT registered to claim back VAT. Now I am not a VAT expert but I dont think you can claim back VAT on a car. I think it is only commerical vechiles such as a jeep with only from seats or a van etc.

I am open to correction on this though. Revenue are great for queries so might be best to give them a shout directly.

Cgm

If the company is VAT registered, then you can claim back the VAT on a commercial vehicle. Also VAT on diesel is also allowed to be claimed back but not on petrol.

A start up company often for the first few VAT returns is in a position of refund as the costs usually alot higher than income made at that stage.

DNA_Accountants

Hi

In relation to vat refund see below revenue information

What is the turnover threshold for VAT registration?

The principal thresholds applicable are as follows:

• (a) €35,000 in the case of persons supplying services (increased to €37,500 as from 1st May 2008),
• (b) €35,000 for persons supplying goods liable at the 13.5% or 21.5% rates which they have manufactured or produced from zero rated materials (increased to €37,500 as from 1st May 2008),
• (c) €35,000 for persons making mail-order or distance sales into the State,
• (d) €41,000 for persons making intra-Community acquisitions,
• (e) €70,000 for persons supplying goods (increased to €75,000 as from 1st May 2008),
• (f) €70,000 for persons supplying both goods and services where 90% or more of the turnover is derived from supplies of goods (other than of the kind referred to at (b) above) (increased to €75,000 as from 1st May 2008) and
• (g) A non-established person supplying taxable goods or services in the State is obliged to register and account for VAT irrespective of the level of turnover.

A taxable person established in the State is not required to register for VAT if his or her turnover does not reach the appropriate threshold above. However, they may opt to register for VAT.


Eventhough you have not traded you may opt to register for VAT by filing Form TR2 with revenue commissioners with your local tax district.

You are allowed to claim vat on Jeep (21.5%) and diesel provided it is wholly, exclusively and necessarily used for business purpose.

Kind Regards,

____________
www.dnaauditors.com

djk1000

Your use of the vehicle is a benefit in kind and you'll have to do payroll and pay tax for yourself because having use of a company vehicle is kind of like an income.