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taxadvisor.uk
taxadvisor.uk, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 4996
Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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I purchased a tractor for £18450.00 two years ago we have nothing

Resolved Question:

I purchased a tractor for £18450.00 two years ago we have nothing but trouble with it. It has been a nightmare and not fit for purpose. The farm suppliers agreed to give us a full refund. We paid £22140.00 including the vat. The suppliers have only paid us the tractor price and not the vat as well so I am £3690.00 short. I have spoken to an accountant who said they should pay it back and they will put a credit note in when they next pay vat to the government as the supplier will have already have paid the tax over.

The farm supplier are now saying to me that when they sold it to me they had to charge vat but as they are now buying it back I cannot charge them back. I am not selling them anything this is not the same as a full refund is it?
Submitted: 3 years ago.
Category: Tax
Expert:  taxadvisor.uk replied 3 years ago.
Hello and welcome to the site. Thank you for your question.

Please advise if you reclaimed VAT when you bought the tractor?

Many thanks
Customer: replied 3 years ago.

No

Expert:  taxadvisor.uk replied 3 years ago.
Lyn, thank you for your prompt reply.

Are you VAT registered?

Many thanks
Customer: replied 3 years ago.

No I am not VAT registered could you please respond

Expert:  taxadvisor.uk replied 3 years ago.
Lyn, thank you for your reply.

You have an issue with the farm suppliers. If they have not refunded the full amount, in my considered view your best course of action would be to recover your loss by bringing a legal action against them for the difference i.e. the VAT element.

It depends on what was agreed as a full refund. It would appear the supplier is not paying back VAT as you are not VAT registered to raise a VAT invoice.

My advice to you would be to come to some compromise arrangement with the supplier instead of pursuing this through the courts. I have sought an opinion from VAT Office and their view it this case falls under a category of dispute between the supplier and consumer.

I hope this is helpful and answers your question.


If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.

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Expert:  taxadvisor.uk replied 3 years ago.
I thank you for accepting my answer.

Good luck.