I had struggled to find the information I needed about both a car and a person qualifying for a VAT free purchase of a car. So I’m sharing what I found out here.
Context: we are a two old battered car household (one being disabled class), looking to use our savings to purchase a new car outright to keep ‘forever’.
When I applied for disabled class road tax, I understood that this class meant that my car could ONLY be used by me or by someone using it ONLY for my benefit. I was looking for information to confirm or deny that the rules for VAT exemption were the same.
Reading the government information on VAT exemption confused me because it said that the car must be for the personal and domestic use of the disabled person, which seemed to be the same rule as for car tax, but it didn’t use the word ONLY.
However, in reference to a person buying a car FOR me it said it should be PRIMARILY for the use of the disabled person. The examples given were for a person not living at the same address.
I was confused because it seemed like a person who didn’t live with me could use the car for their personal use but my husband couldn’t!!
I visited countless forums and encountered opposing opinions on all of them, so I decided to telephone HMRC, and spoke with a member of their VAT technical team.
I told them about my confusion and was told that:
* car tax is a completely separate thing with it’s own rules
* car to be used PRIMARILY for the disabled person applies to all circumstances
* PRIMARILY can be thought of in percentages of use if that’s helpful
*incidental use by the spouse is permitted
* spouse driving to work every day was given as an example as being definitely NOT primarily for the use of the disabled person
* they trust that people who apply for VAT exemption are entitled to it
* it is impossible for them to monitor the specific use of any VAT exempt vehicle but they do investigate if complaints of abuse of the system are received.
So for us this is all good news because I already use my car far more frequently than my husband uses his, so we wouldn’t need to change anything to comply with the VAT exemption for a new car.
