After a long period of development, HMRC has published updated replacement guidance on the VAT treatment of grants and contracts.
CTG’s VAT Expert Group was invited to comment on a draft of the guidance and overall we feel it is an improvement, particularly the sections on indicators of the supply position and related factors to help determine whether the payment is consideration for a supply or not.
CTG is now in the process of reviewing the final version of the guidance and will continue to engage with HMRC where some of our suggestions have not been progressed.
We would welcome feedback from members on the updated guidance (to firstname.lastname@example.org) and have published a detailed commentary on the changes here. Sections of the Charity Tax Map online will also be updated in due course.
HMRC internal manual: VAT Supply and Consideration
- VATSC51620: Introduction
- VATSC51630: What is a grant?
- VATSC51640: HMRC’s approach
- VATSC51660: Relevant legislation
- VATSC51680: Related guidance
- VATSC51700: Subsidies
- VATSC51800: Indicators of the supply position
- VATSC51820: Factors indicating the payment is not consideration for a supply
- VATSC51840: Factors indicating the payment is consideration for a supply
- VATSC51860: Factors that are neutral
- VATSC51900: Important Court Decisions
- VATSC51910: Hillingdon Legal Resource Centre
- VATSC51920: Wolverhampton Citizens’ Advice Bureau
- VATSC51930: Trustees of the Bowthorpe Community Trust
- VATSC51940: Office des Produits Wallons ASBL v Belgium
- VATSC51950: Keeping Newcastle Warm
- VATSC51960: Edinburgh Leisure & Others
- VATSC51970: University of Southampton
- VATSC51980: Bath Festivals Trust
- VATSC51990: Groundwork Cheshire
- VATSC52000: Hope in the Community Ltd
- VATSC52010: South African Tourist Board
- VATSC53000: European Grants
- VATSC53500: Agricultural Grants
- VATSC53510: Mohr
- VATSC53520: Lanboden-Agrardienste Gmbh & Co KG
- VATSC53530: Treatment of Dried Fodder