- This topic is empty.
-
Posts
-
A freehold of a car park on a 25 year lease is up for auction at a guide of £700k. It would be purchased by a non-VAT registered individual as an investment. If it is subject to VAT it pushes the Guide up to £840k with VAT at 20% and may make the purchase unviable. Can it be purchased VAT exempt or can the VAT be reclaimed?
Hello Exclaret
Thank you for your query. Unfortunately, I can’t really give any helpful advice here because there are several factors that could affect the VAT position. In certain circumstances, it may be possible to purchase the property free from VAT if the car park business will be carried on as a going concern, but only apply if the purchaser is registered for VAT.
I’d be happy to help on a formal basis if you’d like to drop me an email using the contact form, but either way I’d strongly recommend that you take advice well before the auction date because if you wish to purchase the property free from VAT as a going concern, you would need to ensure that you are registered for VAT with effect from the date of purchase. Furthermore, stamp duty land tax is usually charged on the VAT inclusive price of any such property so the addition of VAT to the purchase price would increase the amount of the stand duty land tax itself.
As you are doubtless aware, VAT and property is one of the most complex areas of the legislation. I never give definitive advice relating to any issue here on the forum and when the query relates to specific property transactions I am reluctant even to give general guidance because there are so many factors that can affect the issue.
Marie
- You must be logged in to reply to this topic.