Readers’ forum: Racehorse

Racehorse

I act for a husband and wife partnership who own a dry-cleaning business that is registered for VAT.

Following a recent inheritance the husband has now purchased a racing horse in his own name and I understand that subject to him finding a sponsor he can reclaim input tax on costs relating to the expenses of the racehorse. If so can he use the existing VAT registration of the partnership to reclaim VAT and account for output tax on income or does he need a separate VAT registration in his own name?

If the partnership registration can be used should he transfer the horse into the joint names of himself and his wife so that it matches the VAT registration? And are there any complications with this approach? He was not charged VAT when he purchased the horse.

The clients...