Originally Posted by Poly
I'm no boating vat expert but, you should only be able to reclaim input vat on purchases which will lead to vatable output supplies. As a result my understanding is input vat could only be claimed on a boat if the boat was being used commercially (and coded accordingly).
....or the company can buy the rib, claim the entire VAT amount back under the Capital allowance for plant and machinery (assuming it costs more than £3k) and make it available for use by employees, excluding any form of hire or reward (commercial use).
HMRC states the following:
'To qualify for plant and machinery allowances, all the following must apply:
you must have incurred capital expenditure on the provision of plant and machinery that is used wholly or partly for the purposes of your business.
You must own the asset in question as a result of incurring that expenditure
the asset must not be something you buy and sell by way of your trade, although you might eventually sell it for some other reason - you may then have to make an adjustment to your capital allowances.
The asset must also not get used up in producing what you sell or supply by way of your trade
the asset must generally be expected to last for more than two years'
ps: I'm not an accountant.