Readers’ forum: Capital goods scheme and pre-registration property asset

I am confused by the mechanics of the capital goods scheme for one of my clients who purchased a property for £500 000 plus VAT in March 2020 but did not register for VAT until 1 March 2024. She trades as a medical practitioner and her standard-rated sales of cosmetic treatments only exceeded the registration threshold on 31 January 2024 – all other sales she makes are exempt from VAT.

How much input tax can my client claim in the next ten years with the scheme calculations? She uses the partial exemption standard method and her standard-rated sales are 25% of her total income. She completes returns on calendar quarters.

I’d appreciate help on the numbers.

Query 20 357 – Harley Hazel.

The answer is not entirely logical but it is in line with guidelines.

This is explained in section 13 of Notice 706/2. It is perhaps a...