Section 116E — Value Added Tax Regulations 1995: Value of a relevant supply

Value of a relevant supply 116E Subject to regulations 116F, 116H and 116I, the value of a relevant supply is the amount determined using the formula A B × ( C × U % ) where— A is the number of months in the prescribed accounting period during which the relevant supply occurs which fall within the economic life of the goods concerned; B is the number of months of the economic life of the goods concerned or, in the case of an economic life commencing on 1st November 2007 by virtue of regulation 116L, what would have been its duration if it had been determined according to regulation 116C or 116G as appropriate; C is the full cost of the goods excluding any increase resulting from a supply of goods or services giving rise to a new economic life; and U% is the extent, expressed as a percentage, to which the goods are put to any private use or used, or made available for use, for non-business purposes as compared with the total use made of the goods during the part of the prescribed accounting period occurring within the economic life of the goods. 116F Where a prescribed accounting period in which a relevant supply occurs immediately follows a prescribed accounting period during which the goods whose use gives rise to that supply were not used or made available for use for any purpose, element “A” of the formula in regulation 116E shall (without prejudice to any other element of the formula) comprise the total number of months falling within the economic life concerned covered by a the prescribed accounting period in which the relevant supply occurs;

and b all preceding prescribed accounting periods which commence after the end of the prescribed accounting period during which the goods were last used or made available for use for any purpose before the prescribed accounting period in which the relevant supply occurs.