Where capital assets are bought after registering for VAT, the full amount of input VAT can be deducted immediately if the full amount is paid up-front and the intended use of the capital asset is the making of zero-rated or standard-rated supplies. If the price is paid in instalments, VAT is accounted for with the periodic payments in line with the time of supply rules.
In cases where capital assets have been bought before VAT registration and VAT has been paid on them, input VAT paid can still be deducted after registration, capped at whatever the net book value was at the time of registration. Net book value is determined in accordance
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Web page updated on 17 Mar 2025 16:35