It seems that there is currently an issue with HMRC’s ‘VAT when you sell a vehicle’ online tool which is producing incorrect results.

For example, if you are selling a used car on which you originally recovered the input VAT to someone in the UK the tool will tell you that you need to charge zero rate VAT under the ‘New Means of Transport’ scheme and complete form VAT411 (the form to report removal of a new vehicle from the UK to another EU country). This is clearly wrong as the scheme only applies to new vehicles.

Agents and businesses using the tool to work out what VAT to charge on selling used vehicles should be mindful of this glitch and seek alternatives ways to verify the VAT position until the tool is fixed. We understand that the ATT have informed HMRC about the issue.

Links to our guides:

Margin scheme

Place of supply: goods

External links: 

HMRC: VAT when you sell a vehicle tool
HMRC guidance: New Means of Transport scheme