My client is a father and son partnership which was established in August 2021 with a view to importing and distributing clothing. As part of their original business plan they purchased warehouse premises for £125 000 plus VAT the building being bought brand new at that point from the developer.
VAT registration was applied for from the outset and VAT reclaimed successfully on the building. However no business activity was undertaken between August 2021 and July 2022 because of problems sourcing the goods from China.
Imports have now started arriving and VATable supplies will be made in the UK of adult clothing. It is the intention of the partners to transfer the business only into a limited company for protection purposes. There is no borrowing involved and hence no financial requirement to charge rent by the partners to the new company; the building was bought outright....
Please reach out to customer services at +44 (0) 330 161 1234 or 'customer.services@lexisnexis.co.uk' for further assistance.