RC Academy · Accounting · 9 min

Margin-Scheme VAT Without the Lost Weekend

Second-hand dealers live on the VAT margin scheme — and most reconstruct it in a panic at quarter-end. This guide covers estimating margin-scheme VAT per deal, as you trade, so quarter-end becomes an email instead of a weekend.

What the data says

01

Margin-scheme VAT is calculated on your margin, not the sale price — but only if your records can prove the purchase price per piece.

02

The killer is provenance: a watch bought in a WhatsApp chat eight months ago needs its buy price on record TODAY.

03

Estimating VAT per deal at the moment of sale changes pricing decisions — some deals are thinner than they look after the scheme.

04

Commission splits and consignment complicate the scheme; document whose piece and whose margin at agreement time, not at filing time.

In the full playbook

The per-deal VAT estimation method (with worked examples)
Record-keeping that survives an HMRC margin-scheme inspection
Consignment + part-exchange under the scheme
Wiring it into Xero: purchase orders, memo invoices, reconciliation

The full playbook lands on WhatsApp.

No email gate, no PDF graveyard — the guide arrives as a conversation you can ask questions of, tailored to your business once we know it.

Send me the full playbook

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