V6.111 Liability of supplies and activities of accountants
Most accountants provide a range of services, many of which would not immediately be associated with the mainstream services such as audit and accountancy services. This diversity makes it necessary for an accountant to take particular care in deciding whether, when and how to account for VAT. Particular attention should be paid where accountants provide services, such as corporate finance, which may qualify for exemption.
While most of an accountant's mainstream services will be fully taxable these exempt activities can exist and may generate significant fee income. As a consequence, while it would be unusual for an accountant to have significant problems with VAT recovery it should not be overlooked.
The main supplies made by an accountant such as accounting, audit, bookkeeping, insolvency, secretarial, taxation and other advisory services are standard-rated when supplied in the UK. The same can be said of many services accountants offer outside their core activities such as the provision of training and other presentations.
However, certain services often provided by accountants may qualify for exemption. These include:
• Some corporate finance services. For commentary see below under 'Corporate finance services'.
• Insurance intermediary services. For commentary on making of arrangements for insurance see V4.123–V4.124.
• Some intermediary services in relation to exempt supplies of credit or investments. For commentary on the supplies made by intermediaries in the financial services industry see V4.136–V4.136J.
Corporate finance services
Many accountants undertake activities which were once the domain