Travel agents and tour operators
1.1 What is the notice about?
It explains how VAT applies to travel agents and tour operators.
The contact information for the Customs and Indirect Tax Directorate has been updated.
This notice and others mentioned are available both on paper and on our internet website at www.hmrc.gov.uk.
Main narrative treatment—V3.591.
1.2 How must I account for VAT if I am a travel agent
If you are a travel agent, how you must account for VAT depends upon your relationship with your customer. The term “travel agent” is often used loosely and a travel agent may act in three ways, which will affect how you must account for VAT.
1.3 How can a travel agent act
A travel agent can be—
— an agent (that is, intermediary)—see Section 2;
— a travel agent acting in its own name—see Section 4; and/or
— a principal—see Section 5.
1.4 How will I know in which of the three ways I am acting
You will have to look at the contractual and documentary evidence between yourself and your customer, see paragraphs 2.1, 4.1 and 5.1.
1.5 Does it matter if I use the term “agent” in my trading name
No. What matters is how you are acting, not what you call yourself. As a travel agent you may be acting as an intermediary for some supplies and a principal for others. You must ensure that you follow the appropriate VAT rules for each case.
1.6 If I receive “commission” from my customer, does it mean that I am an intermediary?