The following Value Added Tax guidance note by Tolley provides comprehensive and up to date tax information covering:
This guidance note provides an overview of the VAT treatment of supplies of research and vocational training.
This should be read in conjunction with the following guidance notes:
HMRC regards research as including the following from a VAT perspective:
De Voil Indirect Tax Service V16.1016 (subscription sensitive); VATA 1994 Sch 9, Group 6; VATEDU37000
If the research is wholly funded by grants, then it will be treated as a non-business activity and the grant money will be outside the scope of VAT.
Prior to 1 August 2013, research undertaken as a business activity was exempt from VAT if it has been undertaken for an eligible body. The UK received a notification from the European Commission that the VAT exemption for business supplies of research between eligible bodies (mainly government departments, schools, universities, charities and other public bodies) does not comply with EU law. As a result of this notification, HMRC withdrew the exemption with effect from 1 August 2013. However, there was a transitional arrangement for supplies of business research where the written contract was entered into before 1 August 2013; whether or not work has already commenced, the
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