Commentary

BB/34B/04 VAT—partial exemption—floor-area based special methods in the retail sector

Part V16 Forms and other HMRC material

BB/34B/04 VAT—partial exemption—floor-area based special methods in the retail sector

BB/34B/04 VAT—partial exemption—floor-area based special methods in the retail sector

Business Brief, Issue 34. 15 December 2004

This Business Brief article sets out Customs' view on the use of floor-area based calculations in partial exemption special methods (special methods), particularly in the retail sector. No other businesses are affected.

This brief deals with questions put to Customs following the Tribunal's decision in the case of Optika Ltd (2004) VAT Decision 18627.

There is no change of Customs' policy. Further information on partial exemption is available in Notice 706 “Partial Exemption” (Part V8).

Background

Optika, a retail optician, appealed against Customs' rejection of their proposed floor-area based special method. The Tribunal agreed with Customs because, in Optika's case, a floor-area based special method did not give a fair and reasonable result.

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