Claiming VAT back

Calibos

We've a (VAT registered obviously) family newsagent that I work in. In the past we have bought computers, printers and consumables and the like and didn't pay VAT on the purchases as they were for business use (accounts, stock ordering and control, printing invoices etc). ie. no real grey area even if they were used to browse the internet on occasion etc

There are some upcoming purchases I have in mind that I am not so sure about but I don't want to just assume that its a non starter and not claim VAT off if we are entitled to it.

So 18 months ago we got some quotes from shop fitters to re-arrange the layout of the shop and renovate. Shocked by the quote for what we were asking especially given the state of the construction industry. It was a non starter.

I put my thinking cap on and eventually my overalls and myself and my brother got to work rearranging the counters in the shop with minimal tools and repurposed a lot of materials. We dismantled counter carcasses and moved and rebuilt them in different shapes etc. With my knowledge of Telecoms and Networking I was able to dismantle tills and scanners and build them into counters, Move Lotto machines and route cables and Computer network the shop, Reconfigure the CCTV system to the new layout ets We did this overnights on our days off for about a month. It was amazing what we achieved with the simple household tools we already had and €100 of tool and odds and ends from Woodies DIY. Didn't think it was worth the hassle trying to claim back the 100 euro we spent at that time.

As amazing a job as we did given the circumstances it still fell far short of what we wanted to achieve when we approached the shop fitters. The place was last properly renovated in the mid nineties. While myself and my brother achieved the aim of dramatically improving the layout and making more room with less choke points for customer access while at the same time actually making room for more Stock displays, the place still had the plaster and paint peeling off walls in places, the woodwork inside tired and worn, the woodwork outside disintegrating due to the elements etc

We feel that finally completing what we started 18 months ago now that there are some limited funds available for maintenace and further improvement to the premises, will go a long way to improving the curb appeal of the premises and attract more passing trade.

So I guess after that long winded preamble, my question is whether I can order some carpentry tools, such as tracksaw, jigsaws, drill, router, paint, plaster Sheet goods(Plywood/MDF etc) through the business with our Newsagent Vat number, do the rest of the work myself with my brother who also works in the shop like we did 18 months ago and claim back the VAT and claim them as an expense. ie. By purchasing the tools and doing the work ourselves overnight over the course of a month if the last chapter of the job is anything to go by, we can do it for an expenditure of about 1500 euro instead of the 7 or 8 thousand we were quoted by shop fitters over 18 months ago.

dbran

Hi Calibos

Should not be a problem.

Regards

dbran

Calibos

Ah David!! I could have posted this on the IFAS forum and still got my answer

Cool, Thats great news. Thanks for your help and apologies that you had to wade through that post:D

Valetta

Does the same test i.e. "Wholly and exclusively for the purposes of the business" not apply to reclaiming VAT as for claiming the expense as a tax deduction?

I would have thought tools would not apply to a newsagents business as they could, and most probably would be used elsewhere.

Perhaps a portion could be claimed?

smeharg

Valetta wrote: »

Does the same test i.e. "Wholly and exclusively for the purposes of the business" not apply to reclaiming VAT as for claiming the expense as a tax deduction?

I would have thought tools would not apply to a newsagents business as they could, and most probably would be used elsewhere.

Perhaps a portion could be claimed?

The wholly and exclusively test is for income tax.

For a VAT deduction the supply must be used for the purposes of the business. This is hardly for anything but the purposes of the business.

If the tools were subsequently used personally by the owners/directors then a question of self-supply might arise. In other words some of the VAT reclaimed may have to be paid back.