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Can I use the global accounting scheme

16/05/2019 11:39:51
I sell vintage and antique jewellery online, everything I sell is under £500 (on average around £100). I usually buy the items individually rather that in job lots. Would I be able to use the Global Accounting Scheme to account for eligible goods? I can't work out from HMRC's guidance pages if the scheme is only for people who buy second items in job lots and sell them for under £500 or for anyone who buys and sells items for under £500.
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Re:Can I use the global accounting scheme

16/05/2019 13:05:01
Hi,

Thanks for your question.

Yes, you could use the Global Accounting Scheme for these sales.

Generally, the Global Accounting Scheme is for businesses that buy and sell bulk volume, low value goods. It can also be used if you buy and sell individual items Bulk purchases with a combined purchase price of over £500 can be included in global accounting.

However, if any individual item has a purchase value of over £500, you must not sell it on under global accounting.

There are some examples of how the £500 limit applies in sections 14.10 and 14.11 of the VAT Notice on the Margin Scheme, which you can view at the following page of our website:

The Margin and Global Accounting Scheme - VAT Notice 718
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Can I use the global accounting scheme

20/05/2019 13:02:51
Hi,

Thank you for the response, that is very helpful.

Can I use the margin scheme account for purchases I have made from VAT registered sellers if they provided an invoice that states I have been charged 0 Vat, but don't state that they are using the margin scheme on the invoice?

Thank you in advance.
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Re:Can I use the global accounting scheme

21/05/2019 06:32:39
Hi,

If you bought the item from another VAT-registered business, selling goods under the scheme, their invoices must show any of the following:

Margin Scheme – second-hand goods, or
Margin Scheme – works of art or
Margin Scheme – collectors’ items and antiques.

If it doesn’t you can’t sell these goods under the Margin Scheme.

If they haven’t charged VAT it’s possible they are using the scheme but have to specifically show this on their sales invoice.

You can check the rules for Margin Scheme invoices in section 5.3 of the VAT Notice:

The Margin and Global Accounting Scheme VAT Notice 718 - Section 5

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