The caravan market is as bonkers as ever.

Jun 20, 2005
14,893
2,130
40,935
Following a serious accident , last week a friend has just sold his 2015 Bailey Unicorn Vigo back the selling Dealer for £14,500. 2 1/2 years he go he paid them £15,250. Not a bad return for all his usage.
This week the Dealer has sold it for £19,650. Even allowing for a warranty , PDI, etc, a nice little earner😉
 
  • Like
Reactions: JezzerB
May 7, 2012
7,393
1,233
25,935
The shortage of new models has driven up second hand prices although if the dealer was advertising at £19,650 it may be the buyer got a discount.
We can beat that, but it was many years ago. We managed to trade in our five year old trophy for £50 more than we paid for it. It did take about three hours though but the dealer did manage to sell it within a fortnight so he did alright as well.
 
May 3, 2021
18
5
515
Following a serious accident , last week a friend has just sold his 2015 Bailey Unicorn Vigo back the selling Dealer for £14,500. 2 1/2 years he go he paid them £15,250. Not a bad return for all his usage.
This week the Dealer has sold it for £19,650. Even allowing for a warranty , PDI, etc, a nice little earner😉
Somebody correct me if I’m wrong, but…..
The dealer buys the caravan for £14,500
He sells it for £19,650 (incl VAT) and pays HMG £3275 VAT
The dealer’s margin is £1875
 
Nov 6, 2005
5,802
996
25,935
Somebody correct me if I’m wrong, but…..
The dealer buys the caravan for £14,500
He sells it for £19,650 (incl VAT) and pays HMG £3275 VAT
The dealer’s margin is £1875
VAT = Value ADDED Tax, so it's based on the difference in buying and selling price, not just the selling price.
 
  • Like
Reactions: JezzerB
May 3, 2021
18
5
515
VAT = Value ADDED Tax, so it's based on the difference in buying and selling price, not just the selling price.
Ahhhhh, I stand corrected. I had calculated 3275 based on the 19650 price. As you say, the VAT should have been applied on £5150 ... VAT £858
Dealer margin £4291

Apologies
 
Jul 15, 2008
3,474
402
20,935
.....to charge VAT you have to be registered with HMRC.
The rate charged on a caravan will be 20% of the sale price if VAT is added.
If the registered seller did not pay VAT on the purchase then he has nothing to claim back via the VAT system and will have to pay the amount charged to HMRC.
He will in addition be liable for any business tax on the profits made as a result of the transaction.
 
Last edited:
May 7, 2012
7,393
1,233
25,935
Ahhhhh, I stand corrected. I had calculated 3275 based on the 19650 price. As you say, the VAT should have been applied on £5150 ... VAT £858
Dealer margin £4291

Apologies
That does assume that was the figure they got for it, assuming the purchaser did not get a discount or trade in an older model for an inflated price and that no work was needed to be done before the sale. It looks high though, even when you deduct any costs for a guarantee and the sales persons commission.
VAT would be payable on the profit margin rather than the full resale price I believe.
 
Jun 20, 2005
14,893
2,130
40,935
Never mind all the things we have said. The Dealer still needs to eat, pay his taxes and keep the caravan industry going. I was just surprised at the amazing mark up. Maybe as the market bottoms out we will see a surplus of excellent units being given away😉
 
Nov 11, 2009
15,724
3,985
50,935
Never mind all the things we have said. The Dealer still needs to eat, pay his taxes and keep the caravan industry going. I was just surprised at the amazing mark up. Maybe as the market bottoms out we will see a surplus of excellent units being given away😉
The last two cars I traded in went on the market at 150per cent of the trade in price. IE £10000 then advertised for £15000. But neither were offered by the dealerships I traded them to. The motor trade do tend to move the cars in unless they are absolutely spot on for their market sector. My daughters recent 2014 Focus was sold via one of these companies that visit the house and take lots of photos and videos plus look at all the paperwork. It’s then offered to competing dealerships via an online auction from the house. She got a good price of around £5300, it popped up in Nottingham two days later at just under £9000. She could have sold it privately but preferred a clean deal with no tyre kickers, or disgruntled purchaser coming around because something may have gone wrong.
 
  • Like
Reactions: Dustydog
Oct 21, 2020
290
159
735
We are thinking of swapping our van, whilst we would get a good price for ours, the stock available is both very over priced or tatty ( only what we have seen).
I'm put off buying new due to the constant tales of leaky vans etc.

Kev
 
Nov 11, 2009
15,724
3,985
50,935
We are thinking of swapping our van, whilst we would get a good price for ours, the stock available is both very over priced or tatty ( only what we have seen).
I'm put off buying new due to the constant tales of leaky vans etc.

Kev
There’s a lot to be said for retaining one that you are comfortable with. We had a S5 Bailey which had new panels front and rear under warranty but gave use 9 years of trouble free usage, and sold privately with an excellent damp survey. It went to a local Subaru salesman but sad to say for him we didn’t buy the Subaru from his dealership.
 
  • Like
Reactions: Kevin M
May 7, 2012
7,393
1,233
25,935
In the current climate I am holding off replacing either the car or caravan until I see how things pan out. Possibly if some really good offer came my way I might be tempted but I do not see it happening.
 
Mar 14, 2005
15,677
1,963
50,935
Never mind all the things we have said. The Dealer still needs to eat, pay his taxes and keep the caravan industry going. I was just surprised at the amazing mark up. Maybe as the market bottoms out we will see a surplus of excellent units being given away😉
I'm not certain that s/h caravans at dealerships will ever be that cheap! One of the effects of the introduction of the CRA, and the liability it places on a retailer, is the need for them to factor in a contingency against having to cover product failures.

There has been a series of video blogs from a car repair shop owner, who has decided to stop selling low cost second hand cars to the public simply because of the CRA. He will now only sell to the trade where the CRA does not apply.
 
Jun 20, 2005
14,893
2,130
40,935
We use to change caravans when we wanted something different
As in layout or general interior decor? When Alu- tech came out we were tempted. Glad we didn’t, they are still prone to leak usually because of poor workmanship😢
 
Jul 15, 2008
3,474
402
20,935
......a caravan dealer must add VAT to his retail price if he is registered with HMRC which is nearly always the case.
If he has bought from a private seller then it may seem his retail price shows a big mark up but in reality the government is imposing a tax on the sale and the dealer is an unpaid collector.
 
  • Like
Reactions: Raywood
May 7, 2012
7,393
1,233
25,935
As in layout or general interior decor? When Alu- tech came out we were tempted. Glad we didn’t, they are still prone to leak usually because of poor workmanship😢
The advantage is that the leak probably causes less damage, but that is no excuse for the thing leaking in the first place.
 
Jun 20, 2005
14,893
2,130
40,935
I was looking at the VAT aspect as an explanation for the large hike in price.

If you believe this “expert” there seems to be two ways of accounting for VAT. Any accountants out there😵‍💫😵‍💫

Margaret Stone, the Daily Mail's Money Doctor, replies: There are two ways in which motor dealers handle VAT on used vehicles. Some charge VAT only on the profit they make on the sale of the car. This is known as the second-hand margin scheme, used by most car dealers.

Alternatively, they can charge VAT on the total transaction cost - that is the second-hand selling price achieved. It depends on how they choose to keep their records.

The second-hand margin scheme requires more paperwork-from the dealer. He must, for example, keep the relevant stock books which include details such as the car's engine number.

Each method of charging VAT is legal, and HMRC is concerned only that the dealer tells them which scheme he is using.

There is no obligation for the dealer to tell the customer at the outset which method of charging VAT will be used. Nor is there a legal right for the customer to know, or be told, how much of the price comprises VAT.

Yet as VAT on the full purchase price is likely to be rather more than VAT on the dealer's profit on the transaction, it seems to me worth asking which method of charging VAT a car dealer uses before deciding to buy..
 
Mar 14, 2005
15,677
1,963
50,935
Unless you are VAT registered and can offset it I can't see any reason why a retail customer has any need to know what scheme a dealer may be using. It can't be negotiated or change the price of a caravan?
 
Jan 3, 2012
7,840
1,565
30,935
As in layout or general interior decor? When Alu- tech came out we were tempted. Glad we didn’t, they are still prone to leak usually because of poor workmanship😢
DD I would say we preferred layout when we started we hired a Marauder 450s what was a five berth our son loved having his own bit then we brought a Sprite Alpine 4 berth when he got older it had bunks and one you had to make up it only cost us £250 .
 
Last edited:
  • Like
Reactions: Dustydog
May 7, 2012
7,393
1,233
25,935
I would have thought that dealers would use VAT on the profit margin. Going for VAT on the full price means the item will cost more and make it harder for them to sell.
 
  • Like
Reactions: Dustydog
Mar 14, 2005
15,677
1,963
50,935
I would have thought that dealers would use VAT on the profit margin. Going for VAT on the full price means the item will cost more and make it harder for them to sell.
VAT is only payable on the difference in value a business creates ultimately , so that is always on the profit margin but its always based on the net price of the transaction. Functionally VAT is always calculated on the net value of a transaction so when buying goods VAT is accounted on the purchase, And when they sell the VAT is also calculated on the net value., but the payment the business makes to the HMRC is the difference between purchase and sales VAT.

When it comes to retail sales the VAT is always calculated on the net value of the sale. - not on the profit margin,
 

ASK THE COMMUNITY

TRENDING THREADS

Latest posts