Effective Planning
In a recent case, a partnership client incurred VAT of £1.837M in purchasing new premises which it would rent to its trading company. The VAT People were heavily involved in managing the cash flow consequence of incurring this VAT. We successfully assisted the client by ensuring that the partnership VAT return end date meant that the client physically received the input tax before the vendor had to pay it to HMRC and in negotiating and drafting the VAT clauses in the contract so that the contract provided for the VAT to be paid after receipt from HMRC, subject to appropriate warranties.
The result was that by effective planning the client did not have to fund the VAT at completion.
