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Second hand goods?

  • 31-07-2012 6:42pm
    #1
    jayo2004
    Registered Users, Registered Users 2 Posts: 359 ✭✭


    Do i add vat on sale of second hand goods. I have some machines I need to sell as I owe revenue some money. I dont use these machines anymore so might as well sell them and pay what I owe but I dont want to get caught for not adding VAT on the sale.


Comments

  • #2
    dbran
    Registered Users, Registered Users 2 Posts: 2,094 ✭✭✭dbran


    Hi

    Yes, if you are VAT Registered.

    dbran


  • #3
    jayo2004
    Registered Users, Registered Users 2 Posts: 359 ✭✭jayo2004


    What if i buy second hand goods from member of the public who is not registered for VAT. Do I still add Vat?


  • #4
    dbran
    Registered Users, Registered Users 2 Posts: 2,094 ✭✭✭dbran


    Yes


  • #5
    smeharg
    Registered Users, Registered Users 2 Posts: 300 ✭✭smeharg


    jayo2004 wrote: »
    What if i buy second hand goods from member of the public who is not registered for VAT. Do I still add Vat?

    You can either add VAT to the selling price or use the margin scheme. The margin scheme is where you account for VAT on the profit margin. For example if you buy a second hand piece of equipment for €20 from an unregistered person and sell it for €100, the profit of €80 is deemed to be a VAT inclusive amount, ie €65 plus VAT at 23% of €15 is €80.


  • #6
    dbran
    Registered Users, Registered Users 2 Posts: 2,094 ✭✭✭dbran


    Hi

    I understood that in order for margin scheme to apply you have to be acting as a dealer for such goods and the goods have to be taken into stock.

    It is unclear from the OP that this is the case.

    Regards

    dbran


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  • #7
    smeharg
    Registered Users, Registered Users 2 Posts: 300 ✭✭smeharg


    dbran wrote: »
    Hi

    I understood that in order for margin scheme to apply you have to be acting as a dealer for such goods and the goods have to be taken into stock.

    It is unclear from the OP that this is the case.

    Regards

    dbran

    From the first post, yes you're right it looks like surplus equipment being off loaded and the margin scheme wouldn't apply.

    I understood his second post to be a separate scenario and question, ie buying second hand goods from unregistered individuals with a view to resale, in which case the margin scheme could apply.


  • #8
    the culture of deference
    Banned (with Prison Access) Posts: 2,196 ✭✭✭the culture of deference


    smeharg wrote: »
    You can either add VAT to the selling price or use the margin scheme. The margin scheme is where you account for VAT on the profit margin. For example if you buy a second hand piece of equipment for €20 from an unregistered person and sell it for €100, the profit of €80 is deemed to be a VAT inclusive amount, ie €65 plus VAT at 23% of €15 is €80.

    What about the VAT that was paid when the item was new.


  • #9
    Woodgate
    Registered Users, Registered Users 2 Posts: 775 ✭✭✭Woodgate


    the culture of deference wrote: »
    What about the VAT that was paid when the item was new.
    Interested to know this myself aswell, I'm looking to buy used/secondhand sports equipment and try and sell it on on smallish margins, if I was registered for VAT it would be tighter again, or am I wrong?


  • #10
    smeharg
    Registered Users, Registered Users 2 Posts: 300 ✭✭smeharg


    Woodgate wrote: »
    the culture of deference wrote: »
    What about the VAT that was paid when the item was new.
    Interested to know this myself aswell, I'm looking to buy used/secondhand sports equipment and try and sell it on on smallish margins, if I was registered for VAT it would be tighter again, or am I wrong?

    The VAT paid on goods purchased by a unregistered person is lost. The margin scheme is an attempt to alleviate the unfairness at having to charge VAT on sales without having an input credit on the goods being sold.

    If you were VAT registered your profits would be reduced, unless you can pass the VAT on.


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