Retail schemes - Apportionment

By Tolley

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

  • Retail schemes - Apportionment
  • Overview of the appointment schemes
  • Operating the schemes
  • Specific transactions
  • Adaptations

This guidance note provides an overview of the rules relating to Apportionment retail schemes 1 and 2. This note should be read in conjunction with the Retail schemes - overview and Retail schemes - specific industries guidance notes.

SI 1995/2518, pt IX, regs 6675VAT Notice 727/4 ; De Voil Indirect Tax Service V3.551V3.576; VRS3000 ; VRS4000 

A business making retail sales can use a retail scheme if they cannot use the normal accounting rules and their turnover does not exceed £130m a year.

The retail scheme used by the business must produce a fair and reasonable result and the business must be able to identify the tax exclusive value of the sale, the applicable VAT rate and be able to produce periodic totals of those amounts.

Overview of the appointment schemes

There are two apportionment schemes that can be used and these have been outlined below.

Apportionment scheme 1

This is the simpler version of the two apportionment schemes and can be used by businesses with a tax

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