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VAT to be charged on sale of Cattle?

JanieB
  • Lifetime Member
  • 14 posts
  • # 82925

Hello All,

This is my first query I have put to you on the Forum.  I have found the Forum to be very useful in the past.

I have just started working for a lady farmer and, apart from the dairy side, she sells embryos, calves and cattle.  She is VAT registered and I noticed that she doesn't charge VAT for the aforegoing.  I will shortly be organising the invoices for her.  Do any of you work for farmers and can help me?  I have tried to get the answer from HMRC website but failed miserably!

Thank you very much.
Jo G
  • Fellow PM.Dip
  • Practice Licence
  • 186 posts
  • # 82929

JanieBsaid:

“Hello All,

This is my first query I have put to you on the Forum.  I have found the Forum to be very useful in the past.

I have just started working for a lady farmer and, apart from the dairy side, she sells embryos, calves and cattle.  She is VAT registered and I noticed that she doesn't charge VAT for the aforegoing.  I will shortly be organising the invoices for her.  Do any of you work for farmers and can help me?  I have tried to get the answer from HMRC website but failed miserably!

Thank you very much.”

Hi Janie,


Have you tried the following HMRC lVAT Notice 701/15 link? http://customs.hmrc.gov.uk/channelsPortalWebApp/channelsPortalWebApp.portal?_nfpb=true&_pageLabel=pageLibrary_ShowContent&id=HMCE_CL_000124&propertyType=document    

2.1 & 2.2 states the sales of live meat & dairy animals is zero rated. 

Point 2.8 details the sale of embryosof species which are normally used for human food may be zero-rated if they are to be used for breeding.

Hope this helps,
Jo  

JanieB
  • Lifetime Member
  • 14 posts
  • # 82933

Hello again Jo!

Thanks for your speedy reply!   I've downloaded the HMRC notice which is very helpful.  Isn't our job varied and interesting?
  • 115 posts
  • # 82955

I do the bookkeeping for a farmer and although the sale of cattle is not vatable my client sells at auction and there is reclaimable vat on the auctioneers fees. Just something to look out for.

 
JanieB
  • Lifetime Member
  • 14 posts
  • # 82971

Hello Steve,

Thanks for information regarding auctioneers fees - I'll keep that in mind!

Best wishes
Trippy
  • Fellow
  • Practice Licence
  • 109 posts
  • # 83008

HI Janie

I have someone that can help you. He knows about VAT on Blood Stock ( I think that it is the term).

He actually came and gave a talk at the Berkshire ICB Meeting on EU VAT. He may even have a newsletter on Bloodstock which I am sure he will send you over.

Terry

T: 01635 576 298

E: thd@terrydockley.co.uk

W: www.terrydockley.co.uk

Regards
Clare
  • Member
  • Practice Licence
  • 88 posts
  • # 83527

Trippysaid:

“HI Janie

I have someone that can help you. He knows about VAT on Blood Stock ( I think that it is the term).

He actually came and gave a talk at the Berkshire ICB Meeting on EU VAT. He may even have a newsletter on Bloodstock which I am sure he will send you over.

Terry

T: 01635 576 298

E: thd@terrydockley.co.uk

W: www.terrydockley.co.uk

Regards
Clare

”

Hi all - as I understand the rules the sale of bloodstock is entirely different to the sale of livestock. Bloodstock is the terminology used for (mainly) racehorses. The sale of horses are subject to VAT - though I understand there has been an easing where racehorses are going for export.

The sale of livestock ie cattle, sheep, pigs also crops and fodder are all zero rated. I have not really thought about why before, but I would assume that it is because in general what is produced from a farm is going into the food chain, so essentially is raw ingredient, but horses are considered a luxury item.

Farms where they have a couple of horses/racehorses/showjumpers as a hobby  tend not to have these animals on the books as it were, also not claiming for any of there expenses either so that they do not fall foul of the VAT rules should they come to sell a horse ie having to charge an extra (current) 20% to achieve the same price. 

Stock sold through the market (live) or direct to slaughter  (deadweight) will be subject to commission - the VAT paid is reclaimable expense by the farm even though it will have been contra'd of the cheque. 
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