A. The answer to your query is found in HMRC guidance manual VIT13440 which states that provided:
- the individual is not VAT registered in their own right;
- the individual gives the rent invoice to the business for payment;
- the business shows the expenditure in full in its accounts; and
- the whole of the premises is used by the business for the purposes of its business,
Then HMRC will accept that the business is entitled to treat the VAT as input tax. In such circumstances they will see the individual as acting in a purely nominal way and not engaged in any separate activity of their own.
