Exemption ― burial and cremation

Produced by Tolley
Exemption ― burial and cremation

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

  • Exemption ― burial and cremation
  • VAT treatment
  • Funeral directors and undertakers
  • Other goods / services
  • Partial exemption
  • Cemetery or cremation services
  • Local authorities
  • Commemorating the dead
  • Transportation services
  • Funeral prepayment plans
  • More...

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 an overview of the VAT treatment of services that are provided in connection with the burial or cremation of human remains.

VAT treatment

The following services are exempt from VAT:

  1. the disposal of the remains of the dead

  2. making arrangements connected with the disposal of the dead

  3. services of one undertaker to another in connection with a specific funeral or cremation

VATA 1994, s 31; VATA 1994, Sch 9, Group 8, items 1 and 2; VBURC1000; 2006/112/EC, Article 371, Annex X, Part B(4); De Voil Indirect Tax Service V4.151; HMRC Notice 701/32

The VAT exemption only applies to the disposal of human remains. Disposal includes, burial, cremation or disposal at sea. This was confirmed in the tribunal case UFD Ltd.

The burial or cremation of an animal is liable to VAT at the standard rate.

The exemption under VATA 1994, Sch 9, Group 1 (land) applies to the provision of grave space and the right to place an urn in a niche, etc.

Funeral directors and undertakers

If the organisation provides a ‘funeral package’, the following goods / services will be exempt from VAT, providing the overall package includes disposing of the remains of the deceased person:

  1. coffins

  2. coffin cover / fittings

  3. casket, scatter tube or urn

  4. embalming

  5. digging and grave preparation

  6. transporting the deceased person to the burial or cremation ground

  7. shroud / robe

  8. using the chapel of rest

  9. providing bearers

  10. transportation of the mourners

  11. tolling the bell and music at the service

If the organisation provides the following services, supplied in

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