# The Value Added Tax (Input Tax) Order 1992, Paragraph 4


(1) NI acquisition VAT charged on the acquisition in Northern Ireland of a motor car from a member State is excluded from any credit under section 25 of the Act.
(2) Sub-paragraph (1) does not apply where the motor car—
(a) is a qualifying motor car which is acquired in Northern Ireland from a member State by a taxable person and the relevant condition is satisfied;
(b) forms part of the stock in trade of a motor manufacturer or a motor dealer;
(c) is acquired in Northern Ireland from a member State by a taxable person whose only taxable supplies are concerned with the letting of motor cars on hire to another taxable person whose business consists predominantly of making supplies of a description falling within item 14 of Group 12 of Schedule 8 to the Act; or
(d) is unused and is supplied on a letting on hire to a taxable person whose business consists predominantly of making supplies of a description falling within item 14 of Group 12 of Schedule 8 to the Act, by a taxable person whose only taxable supplies are concerned with the letting on hire of motor cars to such a taxable person.
(3) For the purposes of this paragraph a motor car is a qualifying motor car if it has never been supplied, acquired from a member State (under the provisions of the Act applicable at the time) or imported, in circumstances in which the VAT on that supply, acquisition or importation was wholly excluded from credit as input tax by virtue of the provisions of this Order.
(4) For the purposes of paragraph 4(2)(a), the relevant condition is that the motor car is acquired by a taxable person who intends to use the motor car—
(a) exclusively for the purposes of a business carried on by that person; or
(b) primarily for a relevant purpose.
(5) For the purposes of sub-paragraph (4)(a), a taxable person is not to be regarded as intending to use a motor car exclusively for the purposes of a business carried on by that person if that person intends—
(a) to let it on hire to any person either for no consideration or for a consideration which is less than that which would be payable in money if it were a commercial transaction conducted at arm's length; or
(b) to make it available (otherwise than by letting it on hire) to any person (including, where the taxable person is an individual, to that taxable person or, where the taxable person is a partnership, a partner) for private use, whether or not for a consideration.
(6) For the purposes of sub-paragraph (4)(b), a relevant purpose is any of the following—
(a) to provide it on hire with the services of a driver for the purpose of carrying passengers;
(b) to provide it for self-drive hire;
(c) to use it as a vehicle in which instruction in the driving of a motor car is to be given by that person.
(7) In paragraph (6)(b) “self-drive hire” means hire where the hirer is the person normally expected to drive the motor car and the period of hire to each hirer, together with the period of hire of any other motor car expected to be hired to him by the taxable person—
(a) will normally be less than 30 consecutive days; and
(b) will normally be less than 90 days in any period of 12 months.

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Source: https://www.legislation.gov.uk/uksi/1992/3222/schedule/2/paragraph/4 (the official version)
Page: https://openlegislation.uk/value-added-tax-input-tax-order-1992/schedule-2/paragraph-4
Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives.