VAT and second hand car schemes

You will need to fill in a VAT return at the end of each tax period.

Here are the special rules you must follow for any vehicles which you have bought or sold under the Margin Scheme during the tax period:

  • box 1 Include the output tax due on all eligible vehicles sold in the period covered by the return
  • box 6 Include the full selling price of all eligible vehicles sold in the period, less any VAT due on the margin
  • box 7 Include the full purchase price of eligible vehicles bought in the period

There is no requirement to include Margin Scheme purchases or sales in boxes 8 and 9 of your VAT return.

If you want to know more about second hand schemes in general (they do not just apply to cars), please contact us.