Other issues relating to partly exempt businesses

Produced by Tolley

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

  • Other issues relating to partly exempt businesses
  • Overview
  • Registration
  • Partial exemption
  • Capital goods scheme
  • Business transferred to a member of a VAT group
  • Incorrectly charging VAT on an exempt supply

Other issues relating to partly exempt businesses

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.


A business which makes exempt supplies faces a number of issues which are not faced by businesses which only make taxable supplies. These issues and their implications are set out below.

See the Examples ― VAT registration in respect of taxable and exempt supplies.


A business or person that only makes exempt supplies is not entitled to register for VAT in the UK. This is because only businesses that make taxable supplies, or make supplies which would be taxable were they made in the UK, are entitled to register for VAT. In reality, there would be little point in a business that makes wholly exempt supplies VAT

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