Page 150 - P6 Slide Taxation - Lecture Day 5 - VAT Part 1

Example

Mr Knowhow, a VAT vendor on the invoice basis, did the following in March 2013:

 He started to use his personal motor vehicle 100% for business purposes. His

business entails only taxable supplies, and he is not a car dealer. The motor
vehicle cost him R66 000 (VAT inclusive) and on the date when he started to use

it for business purposes, it had a market value of R37 500.

 He started to use his private computer 100% for business purposes. The

computer cost him R11 355 (VAT inclusive) and had a market value of R7 300

when he started to use it for business purposes.

 He started to use his private printer 97% for business purposes. The printer was

bought second-hand from a non-vendor for R2 500 and had a market value of R1
500 on the date on which he started to use it for business purposes. The full

purchase price had been paid.

 He converted 80% of his private residence into offices. He bought his residence

for R500 000. He bought the residence on credit from the seller and has paid

only R300 000 up to date. At the date when he started to use 80% of the
residence as offices, it had a market value of R750 000.

Calculate the VAT consequences of the above.