Research Indicates Businesses Overpay VAT

The British Vehicle Rental and Leasing Association (BVRLA) have carried out research which has concluded that many leased fleets are overpaying VAT by hundreds of millions of pounds. Currently business that lease vehicles can recover a fifty percent of VAT portion of the finance element of their rental payments.

BVRLA believe that their finding shows a figure which is far too low and feel it is being discounted by the government.

There are now suggestions that the VAT recovery rates should be adjusted to be more an equitable rate to businesses that lease cars, however this is considered unlikely to be taken into consideration by the new coalition government especially with the increase in VAT come January 2011.