HM Revenue & Customs

If a road vehicle was purchased in good faith believing that any VAT due had been paid, am I (or is my client) liable to pay the VAT if it has not been accounted for?

HM Revenue and Customs (HMRC) strongly advise that before purchasing any road vehicle that does not have a UK registration, either in the UK or abroad, evidence is obtained from the supplier of the vehicle that UK VAT has been accounted for or is not due.

If you make an application to register and license a vehicle that has not been notified to HMRC the DVLA/DVA will not register the vehicle (this will not affect your legal obligation to obtain a UK registration for the vehicle if you intend to keep it in the UK for road use). In order to register and license your vehicle you will need to make the notification and pay any VAT that is due as part of the notification process.

If the supplier has incorrectly sold the vehicle, on the understanding that VAT has been accounted for or is not due, this is a matter between the purchaser and the supplier.