Discussion
If someone is starting a new business and predicted turnover is less than the VAT threshold is it worth considering registering to claim back initially VAT on capital expenditure.
Most businesses require capital purchasing of some sort be it machines transport or whatever as 'tools of the trade'
So say I was spending £40k on assets for the business with the VAT element being £7k in the first Qtr of my Year 1 and my sales turnover only amounts to say £20k in year 1 therefore my VAT inputs exceed outputs in year1 would I be able to reclaim the net £3.5k? In fact would I be able to reclaim the £7k if I had made no sales in Qtr1
It sounds too simple so I guess there is a catch can any experts (EricMc)assist?
Most businesses require capital purchasing of some sort be it machines transport or whatever as 'tools of the trade'
So say I was spending £40k on assets for the business with the VAT element being £7k in the first Qtr of my Year 1 and my sales turnover only amounts to say £20k in year 1 therefore my VAT inputs exceed outputs in year1 would I be able to reclaim the net £3.5k? In fact would I be able to reclaim the £7k if I had made no sales in Qtr1
It sounds too simple so I guess there is a catch can any experts (EricMc)assist?
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