This paragraph examines the margin scheme that applies to used motor cars.
General principles of the margin scheme for used motor cars
An order1 made under VATA 1994, s 50A provides that a taxable person may opt to account for VAT on the profit margin on a supply of a used motor car rather than by reference to its value2 in the circumstances described below.
The order in question is SI 1992/3122, art 8. The order is otherwise known as the value added tax (cars) order.
Meaning of used motor car for the purposes of the margin scheme
A motor car is a vehicle within the description set out in V1.293 (which considers the definition of 'motor car' in relation to VAT as SI 1992/3122, art 2).
A motor car is not 'used' merely because it has been registered or has been purchased from another dealer and has incurred some road mileage en route. Per the tribunal in Lincoln Street Motors3 used cars are motor cars which
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