Monday, September 27, 2010
Dealers braced for HMRC to claw back VAT
Dealers could face more tax bills from the HMRC for VAT claims on the sale of demonstrator vehicles after it claims it has repaid too much in certain cases.
Many motor dealers have submitted one or more claims for VAT they overpaid on the sale of demonstrator vehicles. Until very recently, the HMRC has repaid those claims without issue, many of which ran into millions of pounds.
HMRC now believes that, in some cases, they have repaid too much to car dealers.
Chartered accountants Baker Tilly said this reflects a change in the HMRC's previous view that partial exemption does not generally affect motor dealers.
HMRC now believes some motor dealers will be partly exempt by virtue of the number of demonstrator vehicles sold and, as such, those businesses should reduce the value of their claim by the amount of input VAT they are not entitled to claim on overhead costs.
Baker Tilly said: “In many cases, motor dealers will not be caught by the partial exemption rules and therefore the refund they have received from HMRC will not be threatened. However, the larger dealer groups with high value claims may well be affected and they should prepare themselves to pay back a proportion of the refund received.”
HMRC is addressing this situation by writing to car dealers with open claims (claims that HMRC have not yet paid) to request they now calculate whether they are caught by the partial exemption rules.
Those that are caught will need to reduce the value of their claim and resubmit it to HMRC.
The situation is somewhat worse for those that have had their claims repaid in the last two years, and who may have already made use of the money.
HMRC is entitled to revisit those claims and claw back any VAT they believe they have overpaid to the dealer.
It appears HMRC will be pursuing paid claims very shortly.
EurotaxGlass's appoints new director and chief editor
EurotaxGlass’s, the automotive intelligence supplier, has appointed Dean Bowkett to its global services team as director and chief editor.
Bowkett joins EurotaxGlass’s from Masterlease’s full service leasing and auto finance division where he last held the position of group CFO leasing and auto finance.
Prior to this, he spent four years at MG Rover Group as head of commercial development and head of UK commercial finance, responsible for residual value management and the daily rental business.
In his new role, Bowkett will with the editorial teams in each country to ensure the consistency of EurotaxGlass’s valuations across the 30 markets in which the company operates, as well as in each industry sector, with his own experience and knowledge matching Glass’s increasing focus on the leasing business.
He will be based in the UK and will also take a lead role in the UK change programme, which will see Glass’s attempt to strengthen its position as a best-in-class valuation and forecasting provider.
DATED: 27.09.10
FEED: AM
Wessex acquires Lookers site in Cardiff
The group bought the site from Lookers and was formerly a Peugeot dealership. It said bigger premises were needed to support the brand's growing product range.
"We can see how Nissan is growing and will develop further in the next two years and wanted to make sure we were able to maximise on that growth," said Keith Brock, Wessex's managing director.
The group also operates Nissan sites in Bristol, Gloucester and Newport.
DATED: 27.09.10
FEED: MT
Easi-Drive targets dealers for growth
The company, which was founded in 2001, has also launched a new brand identity and expanded its head office.
"We have been working hard over the last 12 months to develop a strong proposition for dealerships and we are starting to make some good inroads in this sector. This market, along with manufacturers, will be a big focus for us over the next three years," said Simon Bellamy, the company's founder.
Bellamy said Easi-Drive will continue to work with its established network of repairers.
Bellamy said the company, which has enjoyed rapid growth, aims to grow turnover from £21m in 2010 to £30m in 2013.
DATED: 27.09.10
FEED: MT
Dealers face HMRC tax bill on VAT overpayments
The warning comes from George Bull, Baker Tilly's head of tax, who said dealers who have submitted claims for VAT they overpaid on the sale of demonstrator vehicles and had them repaid by HMRC are at risk.
"Until recently HMRC have repaid those claims without issue, many of which ran into millions of pounds. HMRC now believe that, in some cases, they have repaid too much to the motor dealers," he said.
"This reflects a change in their previous view that partial exemption does not generally affect motor dealers. HMRC now believe that some motor dealers will be partly exempt by virtue of the number of demonstrator vehicles sold and, as such, those businesses should reduce the value of their claim by the amount of input VAT they are not entitled to claim on overhead costs.
Bull said HMRC is writing to dealers with to request they calculate whether they are caught by the partial exemption rules. Those that are caught will need to reduce the value of their claim and resubmit it to HMRC.
"The situation is worse for those that have had their claims repaid in the last two years, and who may have already made use of the money," he said.
HMRC is entitled to revisit those claims and claw back any VAT they believe they have overpaid to the dealer. It appears HMRC will be pursuing paid claims very shortly.
"In many cases, motor dealers will not be caught by the partial exemption rules and therefore the refund they have received from HMRC will not be threatened. However, the larger motor dealers with high value claims may well be affected and they should prepare themselves to pay back a proportion of the refund received."
DATED: 27.09.10
FEED: MT
