Commentary

V3.533 Margin scheme—the auctioneers' scheme

Part V3 Supplies, acquisitions and imports

V3.533 Margin scheme—the auctioneers' scheme

V3.533 Margin scheme—the auctioneers' scheme

Agents who act in their own name in relation to a supply of goods are treated as both receiving and making a supply of those goods themselves1. Supplies through agents are described in V3.221. Agents who sell eligible goods and meet the other conditions of the scheme may use the margin schemes as described in V3.532, V3.534 and V3.535.

An auctioneer who sells goods in his own name on behalf of a principal may under general principles make three separate supplies—the supply of the goods sold, a supply of services to the seller in consideration of the selling commission and a supply of services to the buyer if a buyer's premium is charged. A modification of the margin scheme enables the auctioneer to take into account the value of the services in calculating the profit margin rather than accounting for tax on the supplies separately. This is referred to by HMRC as the auctioneers' scheme2.

Under the auctioneers' scheme, an auctioneer acting in his own name may

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