The following Value Added Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:
This guidance note provides an overview of the main VAT principles governing the use of retail schemes. This note should be read in conjunction with the following guidance notes:
Retail schemes - Point of Sale
Retail schemes - Apportionment
Retail schemes - Direct Calculation
Bespoke retail schemes
Retail schemes - specific industries
Retail schemes - Daily Gross Takings (DGT)
Coupons and vouchers
Cash backs and loyalty schemes
VATA 1994, Sch 11, para 2(6); SI 1995/2518, regs 66–75
De Voil Indirect Tax V3.551–V3.576
Retail schemes are intended to be used by businesses that cannot be expected to use the normal invoice accounting rules for supplies made. The scheme can only be used for retail sales. Retail schemes are usually used for low value supplies that are made to significant number of customers. If a business makes retail and non-retail sales, it will be expected to be able to identify both types of supply in order to account for VAT in the normal way on any non-retail supplies made.
Sales to other VAT registered customers should not be included in the a retail scheme, unless these are occasional cash sales, provided by businesses who may supply goods to VAT registered customers, such as garages and DIY stores.
HMRC considers that the need to use retail schemes has greatly diminished over recent years with the advent of more sophisticated technology, such as bar codes and EPOS tills, and therefore retailers are expected to use this technology in order to determine the correct VAT rate applicable to goods and services supplied when the customer pays for the item, rather that rely on a retail scheme.
Retail schemes cannot be used in conjunction with the flat rate scheme for small businesses.
There are various types of schemes in operation and these are explained below.
These are the types of standard schemes that are available:
Point of Sale
The standard schemes are only available to businesses with an annual VAT inclusive turnover
**Free trials are only available to individuals based in the UK. We may terminate this trial at any time or decide not to give a trial, for any reason.
Access this article and thousands of others like it free for 7 days with a trial of TolleyGuidance.
Read full article
Already a subscriber? Login
Liability of the personal representativesAfter a person’s death, the property of the deceased is vested in the personal representatives (PRs) to enable them to manage and distribute the estate in accordance with the Will or the terms of intestacy. See the Personal representatives guidance note.The
Usually, allowable capital losses can only be set against chargeable gains. If the losses are not fully utilised against gains in the year in which they arise, the excess is carried forward to use against future gains. See the Use of capital losses guidance note for further details.This rule can be
A ‘pilot trust’ is one that holds a nominal amount of property (typically a small sum of cash) and does not become active until further funds are added later. The later addition is sometimes made on the client’s death by a gift in his Will. The use of pilot trusts in conjunction with Wills became a
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
To view our latest tax guidance content, sign in to Tolley Guidance or register for a free trial.