Value Added Tax

Business promotion schemes ― coupons

Produced by Tolley
  • 18 Nov 2021 20:50

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

  • Business promotion schemes ― coupons
  • What are money-off coupons?
  • What is the VAT treatment of the sale and issue of coupons?
  • What are the VAT consequences of redeeming coupons?
  • Businesses operating a retail scheme
  • Businesses that do not operate a retail scheme
  • Payments by third parties
  • Business gift rules
  • Handling charges
  • Practical points

Business promotion schemes ― coupons

This guidance note covers the VAT implications of issuing or redeeming of coupons.

See the Business promotion schemes ― overview guidance note for details of the other types of business promotion schemes that can be used.

For more in depth commentary, see De Voil Indirect Tax Service V6.169.

What are money-off coupons?

Coupons are normally issued in order to give a customer a discount off a future purchase and are often referred to as discount vouchers. The decision in Boots confirmed that money-off coupons are not to be treated as consideration when used to buy other goods but are simply evidence of entitlement to a discount.

Coupons can be issued in a number of ways, including (this list is not exhaustive):

  1. when a product is purchased

  2. by purchasing goods of a certain value

  3. email or other electronic means

  4. via the post

  5. via magazines or newspapers

The coupons can be issued either by the retailer or the manufacturer.

What is the VAT treatment of the sale and issue of coupons?

Money off coupons are generally issued free of charge and no VAT is due on the issue of the coupon providing that the goods / services acquired

Access this article and thousands of others like it
free for 7 days with a trial of TolleyGuidance.

Think Tax.
Think Tolley.

Critical, comprehensive and up-to-date tax information

LEARN MORE LEARN MORE

Popular Articles

Structures and buildings allowance

What is structures and buildings allowance (SBA)?From 29 October 2018, expenditure on constructing a non-residential building or structure, or in certain cases, expenditure on acquiring such a building or structure, qualifies for an SBA. The following note has been updated for the changes announced

05 Jan 2022 14:50 | Produced by Tolley Read more Read more

Indexation allowance and rebasing

This guidance note explains the general rules surrounding the availability of indexation allowance on the disposal of company assets and provides information on the rebasing rules for assets held on 31 March 1982. For an overview of the general position regarding company disposals, please refer to

19 Oct 2021 22:59 | Produced by Tolley in association with Jackie Barker of Wells Associates Read more Read more

Share for share exchange

This guidance note considers the capital gains tax implications where shares are sold in exchange for new shares.The consideration paid by a purchasing company to the shareholder(s) for their shares in a target company could be in the form of either:•new shares in the purchasing company in exchange

10 Jan 2022 15:02 | Produced by Tolley Read more Read more