Commentary

BB/7D/00 VAT treatment of vehicle clamping and tow-away fees

Part V16 Forms and other HMRC material

BB/7D/00 VAT treatment of vehicle clamping and tow-away fees

BB/7D/00 VAT treatment of vehicle clamping and tow-away fees

Business Brief, Issue 7. 18 May 2000

This business brief clarifies the VAT treatment of vehicle clamping and tow-away fees, in particular, where they are retained by parking enforcement contractors.

Background

Parking enforcement contractors are increasingly used by landowners to enforce parking restrictions on their premises. Vehicles found to be parked without authority are normally clamped or towed away. To secure the release of the vehicle, the owner must pay a fee to the contractor.

In collecting this fee, the contractor is acting as an agent for the landowner. At that point, the fee represents

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