Purpose of Report:
To identify VAT-bearing used vehicles where Input VAT has been claimed on the purchase but the Output Tax declared on sale is less than this.
•Those with little or no Output VAT may have been incorrectly sold as margin scheme vehicles.
Bear In Mind:
The vehicle may have been zero-rated as a n export or disabled adaption - see bullet points under NV1 - Liability Issues. The vehicle may also have been supplied inter-company. If this is the case, ensure:
•The "importing" dealership has treated the vehicle as VAT qualifying when finally sold; and
•Input Tax hasn't been recovered again by the "importing" dealership - VAT will have already been recovered when the vehicle was originally acquired.