Commentary

V3.432 Goods and services purchased before incorporation

Part V3 Supplies, acquisitions and imports

V3.432 Goods and services purchased before incorporation

V3.432 Goods and services purchased before incorporation

Regulations made under VATA 1994 s 24(6)(c) provide that tax on goods and services supplied to, and tax paid on goods acquired or imported by, a person who becomes a member, officer or employee of a body corporate may be treated as input tax by the body corporate if HMRC so authorise1. The following conditions must be met.

  1.  

    (1)     The body corporate must be a taxable person2.

  2.  

    (2)     The member, officer or employee must meet all of the following conditions3

  3.  
    1.  

      (i)     he must be reimbursed, or receive an undertaking to be reimbursed, by the body corporate for the whole amount of the price paid for the goods or services;

    2.  

      (ii)     he must not have been a taxable person at the time of the supply, acquisition or importation;

    3.  

      (iii)     he must have imported, acquired or been supplied with the goods, or received the services, for the purpose of a business to be carried on by the body corporate; and

    4.  

      (iv)     he must not have used the goods or services for any other

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