Exempt finance ― fund management

By Tolley
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The following Value Added Tax guidance note by Tolley provides comprehensive and up to date tax information covering:

  • Exempt finance ― fund management
  • Management of investments and portfolios, funds, wrapper products and related services
  • What constitutes ‘management’?
  • Collective investment undertakings
  • Recovering input tax
  • Wrappers, wraps, nominee accounts and fund supermarkets
  • VAT treatment of wrapper products
  • Discretionary investment management services
  • Investment platforms
  • Conclusion

This guidance note provides an overview of the VAT treatment of investment fund management services.

Management of investments and portfolios, funds, wrapper products and related services

2006/112/EC , Article 135 (1)(g); VATA 1994, Sch 9, Part II, Group 5, Item 10, note 6; SI 2008/2547 (subscription sensitive); VATFIN5000; VAT Notice 701/49: finance ; De Voil Indirect Tax Service V4.136, V4.136A–V4.136J (subscription sensitive); VATFIN5100

The management of special investment funds is exempt from VAT. The UK exempts the following types of special investment funds:

  • authorised unit trust schemes (AUTS) that have the meaning given in Financial Services and Markets Act 2000, s 237(3) (subscription sensitive)
  • an authorised open ended investment companies (OEIC) that have the meaning given in Financial Services and Markets Act 2000, s 237(3) (subscription sensitive)
  • a Gibraltar collective investment scheme that is not an umbrella scheme, or a sub-fund of any other Gibraltar collective investment scheme (defined in FSMA 2000, s 264 subscription sensitive)
  • an individually recognised overseas scheme that is not an umbrella scheme, or a sub-fund of any other individually recognised overseas scheme (defined in FSMA 2000, s 272 subscription sensitive)
  • a recognised collective investment scheme authorised in a designated country or territory that is not an umbrella scheme, or a sub-fund of any other recognised collective investment scheme authorised in a designated country or territory. Collective investment scheme has the meaning given in FSMA 2000, s 270 (subscription sensitive)
  • a recognised collective investment scheme constituted in another EEA state that is not an umbrella scheme, or a sub-fund of any other recognised collective investment scheme constituted in another EEA state (see FSMA 2000, s 264 subscription sensitive)
  • from 28 June 2013, an authorised contractual fund (ACF). An ACF is an authorised contractual

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