Taxi Hire - VAT Exempt?

J

jokerini

Registered User
Messages
91
A sole trader purchased taxis and taxi plates. He then hires the cars/plates out to taxi drivers for €200 per week.

Is this activity subject to VAT? I believe the rental of vehicle is subject to VAT. However, the hire of taxi plates is VAT exempt. Which category does this fall into?
 
I think you have two supplies one VATable the other not. What's the basis of €200 per week charge? This may dictate how much relates to each supply.

If your turnover of taxable supplies is less than the registration threshold then you don't need to register.

The operator will be exempt so will not be able to recover VAT.

Perhaps other contributors have a view.
 
Joe_90 said:
I think you have two supplies one VATable the other not. What's the basis of €200 per week charge? This may dictate how much relates to each supply.

If your turnover of taxable supplies is less than the registration threshold then you don't need to register.

The operator will be exempt so will not be able to recover VAT.

Perhaps other contributors have a view.
Click to expand...

Agreed.

It's a mixed supply so the charge will need to be split between plate hire and car hire.

Inputs (VAT on purchases) will need to apportioned between those attributable to the exempt supply and those attributable to the taxable supply. Obviously there's no reclaim on the portion attributable to the exempt part of the supply.

Also watch out for rate change between short term hire and long term hire.
 
Thanks for the replies. If the vehicle is eventually sold, does VAT have to be apportioned to the sale in the same proportion (part exempt/part taxable)?
 
the rental of the Taxi as a package ie ..car plate meter printer sign insurance, to another individual is under the new taxi regulation bill subject to Tax not vat. the licensed owner of the vehicle must now declare if renting/ leasing his vehicle to another individual all relevant details of who the rentee/ leasee is and the amount involved and period of rental / lease involved. both are then liable ti Tax on income at source, much the same scenario now also applies if a plate license holder is renting / leasing his plate only to a company or individual. details of all such information can be had at NTA/taxi.ie
 
also might I add for the benefit of anyone requiring information on all aspects of the Taxi Industry, if in doubt...check it out...go to the NTA taxi.ie website (national transport authority) where contacts details are available to answer any Query one may have regarding rules regulations of the SPSV industry for both service providers, and consumers.
 
You must log in or register to reply here.
Back
Top