Difference Between Margin and Qualifying VAT

Modified on Thu, 26 Sep at 2:36 PM

Margin VAT:
- Applied to the profit margin made on the sale of a vehicle.
- Commonly used for second-hand goods, including vehicles, where VAT is charged only on the difference between the purchase price and the selling price.
- The VAT is not shown separately on the invoice, as it is included in the margin.
- Within Navigator this can be seen on the Profit Analysis
Qualifying VAT:
- Applied to the full selling price of a vehicle.
- Used for vehicles that are VAT qualifying, meaning the VAT can be reclaimed by the buyer if they are VAT registered.
- The VAT is shown separately on the invoice, allowing for transparency and potential VAT recovery by the buyer.