Exempt – burial and cremation

By Tolley

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

  • Exempt – burial and cremation
  • VAT treatment
  • Funeral directors and undertakers
  • Other goods / services
  • Partial exemption
  • Cemetery or cremation services
  • Commemorating the dead
  • Transportation services
  • Funeral prepayment plans

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:

  • the disposal of the remains of the dead
  • making arrangements connected with the disposal of the dead
  • 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, Art 371 ; De Voils Indirect Tax Service V4.151 (subscription sensitive); 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 (VTD 1172)

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

The grant of any interest in land is exempt from VAT under VATA 1994, Sch 9, Group 1 and it is not necessary for them to be connected with a burial or cremation in order to be exempt from VAT. The exemption will apply 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:

  • coffins
  • coffin cover / fittings
  • casket, scatter tube or urn
  • embalming
  • digging and grave preparation
  • transporting the deceased person to the burial or cremation

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