Most countries have a special scheme for re-selling units purchased from private individuals. This is because we cannot normally claim back Tax on the purchase price unless the supplier is a business and has a Tax Number, and it would not be fair if you had to pay the tax on the full selling price.


You can set the default Tax Code for Used units in Settings / System / Sales.


UK and Europe

When under the scheme, when the Unit is purchased, VAT is not claimed on the purchase transaction and you must supply a unit receipt with the correct wording saying that Input tax has not or will not be claimed on this transaction. When the unit is sold, there should be no VAT on the selling price, however when producing the VAT Return or the Used Unit Stock book, it will show VAT calculated on the margin (difference between what you bought it for and what you sold it for).


For example if the VAT rate is 20%, if you bought a unit for 5,000 and sold it for 6,200, the margin would be 1,200 and the Used Unit VAT payable would be 200. This means the actual net profit after the Used VAT is paid would be 1,000.00. Note if the margin is less than zero, the Used Unit VAT will be zero.


Please ensure you have a tax rate set up for the Used Unit Scheme with the Buy Rate set to zero, the Sell Rate set to zero and the Special Rate set to the current tax rate


Australia and New Zealand

When under the scheme, when the Unit is purchased GST is NOT claimed on the purchase transaction, however the Buy price of the unit is shown as if the GST has been claimed. This is because when the Unit is sold the GST can be claimed back, and we want to be able to see the correct eventual profit figures.


When the unit is sold the GST should be included in the selling price and GST shown on the Invoice. When producing the BAS Worksheet or the Used Unit Sales book, it will show GST to be claimed on the purchase price of all units sold in that period (on the Used Scheme). Note if the Sell price is less than the purchase price the GST is claimed on the (Lower) Sell price.


For example if the GST rate is 10%, if you bought a unit for 5,000 and sold it for 6,200, the gross margin would be 1,200. However GST of 454.55 would be claimed on the buy price of 5,000, and GST of 563.64 paid on the selling price of 6,200. This would make the net buy price: 4,545.45, the net sell price: 5,636.36 and the net margin: 1,090.91.


Please ensure you have a tax rate set up for the Used Unit Scheme with the Buy, Sell and Special Rates all set to the current tax rate.