.png)
.png)
01 August 2017
VAT issues with a contract in own name rather than as a partnership.
I read Neil Warren’s article in Taxation about business splitting and think a client might have created a problem with an unintended business split. There are two issues here.
- The client is VAT registered as an estate agent in partnership with his wife.
- The client has just done a deal with a farmer to develop some land (they are seeking planning permission for residential construction) which the farmer can then sell to a house builder. My client will incur costs of about £100 000 (all subject to VAT) and then receive a commission from the farmer based on the final sale proceeds.
The farmer has opted to tax the land and will be able to claim input tax on his costs so there is no potential VAT loss. But my client appears to have scored an own goal by signing the contract with the farmer...
Alternatively, you can register free of charge to read a limited amount of subscriber content per month.
Once you have registered, you will receive an email directing you back to read this item in full.
Please reach out to customer services at +44 (0) 330 161 1234 or 'customer.services@lexisnexis.co.uk' for further assistance.
