Selling laptop bought under flat rate scheme as it can't be returned

[theAccountant]

I bought a laptop for my ltd which is unsuitable, but can't be returned as it was a business purchase.

I would now like to sell it via ebay, as it will just collect dust otherwise. It was bought under the flat rate scheme.

Is there anything I need to bear in mind? Do I need to charge the buyer VAT on it?

Maccy, you may be able to claim back the VAT on the laptop if the VAT-inclusive price of the purchase was £2,000 or more and this was all shown on a single invoice. If you fall into this category, and claim back the VAT on the laptop, then when you come to sell the asset , you must charge VAT at the full standard rate - not at your flat rate percentage. You may need to then issue a VAT invoice to the purchaser (albeit on ebay) so that the potential buyer (should they be able to reclaim the VAT) can do so.

Hope this is of help.

theAccountant

[Contreras]

Maccy, you may be able to claim back the VAT on the laptop if the VAT-inclusive price of the purchase was £2,000 or more and this was all shown on a single invoice. If you fall into this category, and claim back the VAT on the laptop, then when you come to sell the asset , you must charge VAT at the full standard rate - not at your flat rate percentage. You may need to then issue a VAT invoice to the purchaser (albeit on ebay) so that the potential buyer (should they be able to reclaim the VAT) can do so.

Hope this is of help.

theAccountant

No ifs about it. The OP must charge VAT at the standard rate must issue a VAT invoice, regardless of whether the input VAT was reclaimed.

[TheCyclingProgrammer]

No ifs about it. The OP must charge VAT at the standard rate must issue a VAT invoice, regardless of whether the input VAT was reclaimed.

I suspect what he meant was that if you reclaimed the VAT, you must account for the VAT at the standard rate on your VAT return instead of applying your flat rate percentage to the gross.

To be fair, the HMRC guidance on this is worded just as poorly:

Selling a capital asset
If you meet all the conditions and claim back the VAT on a capital asset, then when you have finished with the asset and sell it, you must charge VAT at the full standard rate - not at your flat rate percentage.

[Contreras]

I suspect what he meant was that if you reclaimed the VAT, you must account for the VAT at the standard rate on your VAT return instead of applying your flat rate percentage to the gross.

To be fair, the HMRC guidance on this is worded just as poorly:

1) Two wrongs don't make a right.

2) Chartered Accountants and Tax Advisors touting on a contractor's forum better had get it right or expect to be corrected.