The VAT Second Hand Margin scheme carries with it specials rules when calculate the right numbers you need to include when filling out your VAT return. You’ll have to make sure you adhere to these, as well as the rules of the standard scheme when it comes to your other sales and purchases.

When you come to fill out your VAT return you’ll need to gather together the items you have sold from your Stock Book for the quarter you are reporting on.  Then you’ll need to total up the following figures ready for the VAT return boxes as follows:

Box 1 Include the output tax due on all eligible goods sold in the period covered by the return

Box 6 Include the full selling price of all eligible goods sold in the period, less any VAT due on the margin

Box 7 Include the full purchase price of eligible goods bought in the period.

You should note:

  • There is no need to include any figures in boxes 7 & 8;
  • Do not include any items you made a loss on;
  • You cannot set a loss on one item off against an item you made a profit on.
Stock Book and Invoice Templates VAT Second Hand Margin Scheme
My Stock Book template works out the figures you need to include in Boxes 1, 6 & 7 automatically

 

 

 

 

 

 

If you have made sales and purchases is the normal way, then you will need to add these figures to your Margin Scheme VAT Figures and include the total amounts in your VAT return.

VAT Second Hand Margin Scheme: Reclaiming VAT on Overheads

Anita is a Chartered Accountant, turned blogger and creator of the ever popular free Go Self Employed Email Mini Course, which has been completed by hundreds of attendees all over the UK. Using her 10 years experience in accounting, tax and operations for Small Businesses, Anita is on a mission to make finance simple for the self employed, so they can stop stressing about tax & finances and focus on building profitable businesses which will give them the lifestyle they dream of.