VAT on insurance claims

[Cogcog]

My insurance company are about to make me an offer to settle a claim.
They had intended to get a contractor to make the repair and pay, but they cannot find a contractor capable or willing to do the full repair to the standard and warranty requirements of the specialist engineer appointed, so have indicated they simply get 3 quotes for a repair cobbled from various suppliers all willing to do part of the job and then make an offer to us.

So, let's say the quotes received average £20k plus VAT ( £24K) . Will I get the £24k or will I get the £20k and the £4k when I can prove I have actually spent the money effecting the repair.

My intention is not o repair but to scrap the job and strat again.

[Josho]

If you are VAT registered then they won't pay VAT.

I.e I've bought a new diagnostic tool at £3500 plus VAT.

If it gets stolen my insurance company will pay me £3500 and I will pay the VAT on a new tool but claim it back.

Same with a customer who's van I repaired. They paid the VAT part of the invoice then claimed it back.

To be fair if I had say a builder sort my house out I wouldn't expect to pay the VAT of an insurance claim but if it was at my garage I would expect to pay it.

[Cogcog]

Let me couch it in a language we all understand.


Say I own a car worth £20k.

It is damaged to the tune of £5k which with the VAT is £6k.

Will the insurers paythe full £6k (the full cost of repair) or just the £5k (excluding VAT) and the £1K in VAT when the repair is done and they get the receipt?

Some time ago I had a bath damaged in transit and they paid for the bath minus the VAT as it had never been fitted.

[chml]

Cash-in-lieu of repair is normally the net amount and they will then pay the VAT upon sight of the final invoice showing the work has been carried out.

[anonymous-user]

They'll pay you the net amount.

[red_slr]

We always have to pay the vat.