Anti-avoidance ― listed schemes ― pre-1 January 2018

Produced by Tolley

The following Value Added Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:

  • Anti-avoidance ― listed schemes ― pre-1 January 2018
  • Listed schemes
  • Scheme 1 - the first grant of a major interest in a building
  • Scheme 2 - payment handling services
  • Scheme 3 - value shifting
  • Scheme 4 - leaseback arrangements
  • Scheme 5 - extended approval periods
  • Scheme 6 - groups: third party suppliers
  • Scheme 7 - education and training provided by a non-profit making body
  • Scheme 8 - education and training by a non-eligible body
  • More...

Anti-avoidance ― listed schemes ― pre-1 January 2018

IP COMPLETION DAY: 11pm (GMT) on 31 December 2020 marked the end of the Brexit transition / implementation period entered into following the UK’s withdrawal from the EU. At this point in time, key transitional arrangements came to an end and significant changes began to take effect across the UK’s VAT and customs regime. This document contains guidance on subjects potentially impacted by these changes. Before continuing your research, see the Brexit — overview guidance note.

This guidance note provides details of the listed schemes which need to be disclosed to HMRC. This note should be read in conjunction with the Anti-avoidance - introduction, Anti-avoidance - hallmark schemes and Anti-avoidance - analysis of relevant case law guidance notes.

Listed schemes

This section provides an overview of the current listed schemes. Please note that HMRC can amend this list if required to include additional schemes.

Scheme 1 - the first grant of a major interest in a building

This scheme is intended to reduce the amount of irrecoverable VAT incurred in relation to enlarging, extending, repairing, refurbishing and servicing buildings that are zero-rated when they are sold by a developer.

The scheme has the following features:

  1. a major interest in granted in respect of the building is made to a connected person at the zero-rate of VAT (see the Sale or grant of a long lease ― zero-rating for newly constructed buildings and Sale or grant of a long lease ― zero-rating for newly converted buildings guidance notes)

  2. the following additional input has been recovered as it has been attributed to the zero-rated grant:

    1. input tax in respect of any service charges levied in respect of the building

    2. input tax that is connected to the extension, enlargement, maintenance, refurbishment, repair of the building. However, input tax will not be deducted on remedying any defects that were associated with the original construction

Examples of the types of arrangements that are included within scheme 1 are:

  1. a

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