VAT on vehicle

[paoloh]

If a Director buys a car on finance that is VAT qualifying and vehicle is used solely for business, can he claim the VAT on the whole amount or just on monthly payments?

[smartie]

probably neither!

Has he bought it outright/HP/PCP or is it contract hire?

Doers he have ANY private use, ie goes home in it, or calls at a shop/school?

[paoloh]

He goes home in it.
PCP

[smartie]

No VAT can be reclaimed then, even if VAT qualifying.

[paoloh]

What stops it from being claimable? Thanks for the help

[smartie]

apart from specific circumstances (ie finance co's, motor dealers, taxi firms etc), if there is any personal use of a car then the input tax cannot be reclaimed.

If it was done on a contract hire basis, you can generally claim 50% of the VAT on the rental.