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What does this relate to?
I ordered some nut files form StewMac in America. Presumably I already paid their own sales tax since the price I paid was the same as someone in America would have paid. Then there was the international shipping which is fair enough.
Then instead of getting it delivered here, I get a note that I have to drive to the sorting office and not only pay the customs tax (which I did expect but still a bit of a stinger if I already paid tax on the item in America) but the Royal Mail were charging me an additional 8 quid on top for no reason other than that I had to pay customs charge!
(It’s not, £166.67 would be the VAT amount assuming the item is at the standard rate of 20%)
The majority of my products are zero VAT rated so I quite enjoy having my return done every quarter as the VAT man gives me money :-)
So no vat on the full amount as per new products
The VAT registered business buys a used guitar for £600 from a seller who is not VAT registered. The business then sells it for £700, which includes a 20% VAT charge on the profit element of £83.33 - a VAT charge of £16.66 that the buyer must pay and the seller must pass onto HMRC?
The VAT sales invoice would show a VAT charge of £16.66?
(It would be easy to figure out how much profit a VAT registered seller would be making on any second hand items otherwise!)
And you wouldn't have paid sales tax in the US. For online orders it's only applied if you're in the same US state as the seller.
do you assume then that at £600 cost and £700 sold - that the dealer then shows the sale as £683.34 + 16.66 vat - total £700
What you can’t reclaim
You can’t reclaim VAT for:and ‘unique stockbook number’ is what I was thinking of, not ‘stock keeping unit’
(oh, and when I said I don’t think so I was responding to TheBigDipper, not you)
*An Official Foo-Approved guitarist since Sept 2023.
point 2) we can mix both schemes but have to record our purchases accordingly, on a different audit trail, with appropriate vat and sold prices accordingly - Then produce a grand total for 1/4 vat returns and yearly accounts