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Can I recover the VAT on short or long term contract hire?

April 26, 2017contract hire recover short term VAT

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Can I recover the VAT on short or long term contract hire?

1 Answer

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10 Posted

The VAT on contract hire rentals is recoverable – subject to Article 7 (2) (A) of the VAT (Input Tax) Order 1992 (as amended). If the vehicle is used for private use the customer can usually reclaim 100% of the VAT on the servicing element and 50% on the finance element of the contract. The majority of alliance contracts are based on non-maintenance packages therefore the rental quoted is considered as all assigned to the finance element.