Commentary

V7.454 Identifying an agency arrangement

Part V7 Tax planning
Part V7 Tax planning | Commentary

V7.454 Identifying an agency arrangement

Part V7 Tax planning | Commentary

V7.454 Identifying an agency arrangement

The VAT liability of the services provided by an agent does not necessarily follow the liability of the goods or services being supplied between the principal and the customer. See Examples 1 and 2.

Example 1

John trades as an agent, trying to find customers for books produced by ABC Publishers Ltd. The latter company sells the books direct to the customer, and arranges for their delivery and invoicing. John does not take ownership of the goods at any stage, and receives £1 commission for every book that is sold – he is VAT registered.

Solution – although the books sold by ABC Publishers Ltd

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