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Q: My client sells second hand goods and ordinarily accounts for VAT under the margin scheme. One of his customers, however, wants him to charge VAT on the sale as they say they are in a position to recover this as input tax. Is this allowable?

A: The margin scheme is optional on a transaction by transaction basis; you do not have to use it for all of your sales even though the goods may be eligible to be sold under the scheme. Examples include goods sold for zero-rated export or where the customer is a VAT registered business that wants to be charged the VAT normally in order to be able to recover it.

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These publications from Markel Tax were correct at the time of going to press and should be considered as principles-based guidance only. To check current validity, call the Markel Tax helpline. ICAEW (as distributor) disclaims all liability for any errors or omissions.

About Markel Tax

Markel Tax offers expert advice on UK tax and VAT via its helpline and provides monthly FAQs with questions and answers on common tax issues for businesses and practitioners.