Q&As

Do the fees of an EIS fund manager qualify for the VAT exemption for intermediary financial services?

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Published on LexisPSL on 17/08/2020

The following Tax Q&A provides comprehensive and up to date legal information covering:

  • Do the fees of an EIS fund manager qualify for the VAT exemption for intermediary financial services?

Do the fees of an EIS fund manager qualify for the VAT exemption for intermediary financial services?

Investment management is generally subject to VAT. Article 135(1)(f) of Directive 2006/112/EC (the VAT Directive) precludes exemption for the management of shares and other securities.

As an exception to this general principle, there is an exemption from VAT for the management of ‘special investment funds’. This has been implemented in the UK as an exemption for the management of the types of fund that are listed in Items 9 and 10 of Group 5 of Schedule 9, Part II to the Value Added Tax Act 1994. We have assumed that none of these apply in this instance.

The VAT exemption for intermediary financial services is available when a supplier, acting in an

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