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More issues with Postponed Import VAT Statements
I feel like I am writing this in every bulletin at the moment, but there have been more issues with HMRC’s PVA system.
Initially, taxpayers were advised that they should not rely on June statements which were published between 4th and 8th July. This was subsequently updated to say any statement for June which was downloaded before 13th July could not be relied upon.
The recent case of Firth (t/a Church Farm) is a useful reminder that VAT is not usually recoverable on motor cars.
VAT is only recoverable in very limited circumstances – the key point being that the vehicle must not be available for private use. It is not enough for it just not to be used privately.
The case found that the vehicles in question were not stored in such a way to prevent private motoring and they were insured for private motoring. This meant that the partners did have the option to use the vehicles privately and so the VAT was not recoverable.