Commentary

BB/11F/03 VAT—schools run by local authorities

Part V16 Forms and other HMRC material

BB/11F/03 VAT—schools run by local authorities

BB/11F/03 VAT—schools run by local authorities

Business Brief, Issue 11. 25 July 2003

The VAT and Duties Tribunal has found in the case of The City of London Corporation (LON/98/913) that the Corporation is not in business when running three fee-paying schools. This Business Brief article explains Customs' position following that decision.

Background

Local government bodies do not act in a business capacity when they engage in activities as public authorities, provided that this does not lead to any significant distortion of competition. Such activities, which can include the provision of education, are outside the scope of VAT.

Local authorities recover the VAT incurred

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