Legalize / United Kingdom / Public General Act

Value Added Tax Act 1994

Type Public General Act

Publication 1994-07-05

Last updated 2024-11-04

State In force

Department Statute Law Database

Source legislation.gov.uk

articles Not indexed

Reform history JSON API

Settling appeals by agreement.

85

(1) Subject to the provisions of this section, where a person gives notice of appeal under section 83 and, before the appeal is determined by a tribunal, HMRC and the appellant come to an agreement (whether in writing or otherwise) under the terms of which the decision under appeal is to be treated—

(a) as upheld without variation, or

(b) as varied in a particular manner, or

the like consequences shall ensue for all purposes as would have ensued if, at the time when the agreement was come to, a tribunal had determined the appeal in accordance with the terms of the agreement ....

(2) Subsection (1) above shall not apply where, within 30 days from the date when the agreement was come to, the appellant gives notice in writing to HMRC that he desires to repudiate or resile for the agreement.

(3) Where an agreement is not in writing—

(a) the preceding provisions of this section shall not apply unless the fact that an agreement was come to, and the terms agreed, are confirmed by notice in writing given by HMRC to the appellant or by the appellant to HMRC, and

(b) references in those provisions to the time when the agreement was come to shall be construed as references to the time of the giving of that notice of confirmation.

(4) Where—

(a) a person who has given a notice of appeal notifies HMRC, whether orally or in writing, that he desires not to proceed with the appeal; and

(b) 30 days have elapsed since the giving of the notification without HMRC giving to the appellant notice in writing indicating that they are unwilling that the appeal should be treated as withdrawn,

the preceding provisions of this section shall have effect as if, at the date of the appellant’s notification, the appellant and HMRC had come to an agreement, orally or in writing, as the case may be, that the decision under appeal should be upheld without variation.

(5) References in this section to an agreement being come to with an appellant and the giving of notice or notification to or by an appellant include references to an agreement being come to with, and the giving of notice or notification to or by, a person acting on behalf of the appellant in relation to the appeal.

Payment of tax on determination of appeal

85A

(1) This section applies where the tribunal has determined an appeal under section 83.

(2) Where on the appeal the tribunal has determined that—

(a) the whole or part of any disputed amount paid or deposited is not due, or

(b) the whole or part of any VAT credit due to the appellant has not been paid,

so much of that amount, or of that credit, as the tribunal determines not to be due or not to have been paid shall be paid or repaid ....

(3) Where on the appeal the tribunal has determined that—

(a) the whole or part of any disputed amount not paid or deposited is due, or

(b) the whole or part of any VAT credit paid was not payable,

so much of that amount, or of that credit, as the tribunal determines to be due or not payable shall be paid or repaid to HMRC ....

(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Payment of tax where there is a further appeal

85B

(1) Where a party makes a further appeal, notwithstanding that the further appeal is pending, value added tax or VAT credits, or a credit of overstated or overpaid value added tax shall be payable or repayable in accordance with the determination of the tribunal or court against which the further appeal is made.

(2) But if the amount payable or repayable is altered by the order or judgment of the tribunal or court on the further appeal—

(a) if too much value added tax has been paid or the whole or part of any VAT credit due to the appellant has not been paid the amount overpaid or not paid shall be refunded with such interest, if any, as the tribunal or court may allow; and

(b) if too little value added tax has been charged or the whole or part of any VAT credit paid was not payable so much of the amount as the tribunal or court determines to be due or not payable shall be due or repayable, as appropriate, at the expiration of a period of thirty days beginning with the date on which HMRC issue to the other party a notice of the total amount payable in accordance with the order or judgment of that tribunal or court.

(3) If, on the application of HMRC, the relevant tribunal or court considers it necessary for the protection of the revenue, subsection (1) shall not apply and the relevant tribunal or court may—

(a) give permission to withhold any payment or repayment; or

(b) require the provision of adequate security before payment or repayment is made.

(4) If, on the application of the original appellant, HMRC are satisfied that financial extremity might be reasonably expected to result if payment or repayment is required or withheld as appropriate, HMRC may do one or more of the things listed in subsection (6).

(5) If on the application of the original appellant, the relevant tribunal or court decides that—

(a) the original appellant has applied to HMRC under subsection (4),

(b) HMRC have decided that application,

the relevant tribunal or court may replace, vary or supplement the decision by HMRC by doing one or more of the things listed in subsection (6).

(6) These are the things which HMRC or the relevant tribunal or court may do under subsection (4) or (5)—

(a) decide how much, if any, of the amount under appeal should be paid or repaid as appropriate,

(b) require the provision of adequate security from the original appellant,

(7) Subsections (3) to (6) cease to have effect when the further appeal has been determined.

(8) In this section—

“adequate security” means security that is of such amount and given in such manner—as the tribunal or court may determine (in a case falling within subsection (3) or (5)), oras HMRC consider adequate to protect the revenue (in a case falling within subsection (4));

“further appeal” means an appeal against—the tribunal’s determination of an appeal under section 83, ora decision of the Upper Tribunal or a court that arises (directly or indirectly) from that determination;

“original appellant” means the person who made the appeal to the tribunal under section 83;

“relevant tribunal or court” means the tribunal or court from which permission or leave to appeal is sought.

Appeals to Court of Appeal.

86

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Enforcement of registered or recorded tribunal decisions etc.

87

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Part VI — Supplementary provisions

Change in rate of VAT etc. and disclosure of information

Supplies spanning change of rate etc.

88

(1) This section applies where there is a change in the rate of VAT in force under section 2 or 29A or in the descriptions of exempt, zero-rated or reduced-rate supplies ....

(2) Where—

(a) a supply affected by the change would, apart from section 6(4), (5), (6) or (10), be treated under section 6(2) or (3) as made wholly or partly at a time when it would not have been affected by the change; or

(b) a supply not so affected would apart from section 6(4), (5), (6) or (10) be treated under section 6(2) or (3) as made wholly or partly at a time when it would have been so affected,

the rate at which VAT is chargeable on the supply, or any question whether it is zero-rated or exempt or a reduced-rate supply, shall if the person making it so elects be determined without regard to section 6(4), (5), (6) or (10).

(3) Any power to make regulations under this Act with respect to the time when a supply is to be treated as taking place shall include power to provide for this section to apply as if the references in subsection (2) above to section 6(4), (5), (6) or (10) included references to specified provisions of the regulations.

(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(5) Regulations under paragraph 2A of Schedule 11 may make provision for the replacement or correction of any VAT invoice which—

(a) relates to a supply in respect of which an election is made under this section, but

(b) was issued before the election was made.

(6) No election may be made under this section in respect of a supply to which paragraph 7 of Schedule 4 or paragraph 2B(4) of Schedule 11 applies.

(7) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(8) References in this section to a supply being a reduced-rate supply are references to a supply being one on which VAT is charged at the rate in force under section 29A.

Adjustments of contracts on changes in VAT.

89

(1) Where, after the making of a contract for the supply of goods or services and before the goods or services are supplied, there is a change in the VAT charged on the supply, then, unless the contract otherwise provided, there shall be added to or deducted from the consideration for the supply an amount equal to the change.

(2) Subsection (1) above shall apply in relation to a tenancy or lease as it applies in relation to a contract except that a term of a tenancy or lease shall not be taken to provide that the rule contained in that subsection is not to apply in the case of the tenancy or lease if the term does not specifically to VAT or this section.

(3) References in this section to a change in the VAT charged on a supply include references to a change to or from no VAT being charged on the supply (including a change attributable to the making of an option to tax any land under Part 1 of Schedule 10).

Failure of resolution under Provisional Collection of Taxes Act 1968.

90

(1) Where—

(a) by virtue of a resolution having effect under the Provisional Collection of Taxes Act 1968 VAT has been paid at a rate specified in the resolution on the supply of any goods or services by reference to a value determined under section 19(2) ..., and

(b) by virtue of section 1(6) or (7) or 5(3) of that Act any of that VAT is repayable in consequence of the restoration in relation to that supply ... of a lower rate,

the amount repayable shall be the difference between the VAT paid by reference to that value at the rate specified in the resolution and the VAT that would have been payable by reference to that value at the lower rate.

(2) Where—

(a) by virtue of such a resolution VAT is chargeable at a rate specified in the resolution on the supply of any goods or services by reference to a value determined under section 19(2) ..., but

(b) before the VAT is paid it ceases to be chargeable at that rate in consequence of the restoration in relation to that supply ... of a lower rate,

the VAT chargeable at the lower rate shall be charged by reference to the same value as that by reference to which VAT would have been chargeable at the rate specified in the resolution.

(3) The VAT that may be credited as input tax under section 25 or refunded under section 33, 33A, 33B, 33C or 35 does not include VAT that has been repaid by virtue of any of the provisions mentioned in subsection (1)(b) above or that would be repayable by virtue of any of those provisions if it had been paid.

Disclosure of information for statistical purposes.

91

(1) For the purpose of the compilation or maintenance by the Department of Trade and Industry or the Statistics Board of a central register of businesses, or for the purpose of any statistical survey conducted or to be conducted by that Department or Board, the Commissioners or an authorised officer of the Commissioners may disclose to an authorised officer of that Department or Board particulars of the following descriptions obtained or recorded by them in pursuance of this Act—

(a) numbers allocated by the Commissioners on the registration of persons under this Act and reference numbers for members of a group;

(b) names, trading styles and addresses of persons so registered or of members of groups and status and trade classifications of businesses; and

(2) Subject to subsection (3) below, no information obtained by virtue of this section by an officer of the Department of Trade and Industry or the Statistics Board may be disclosed except to an officer of a Government department (including a Northern Ireland department) or to a member of the staff of the Scottish Administration for the purpose for which the information was obtained, or for a like purpose.

(3) Subsection (2) above does not prevent the disclosure—

(a) of any information in the form of a summary so framed as not to enable particulars to be identified as particulars relating to a particular person or to the business carried on by a particular person; or

(b) with the consent of any person, of any information enabling particulars to be identified as particulars relating only to him or to a business carried on by him.

(4) If any person who has obtained any information by virtue of this section discloses it in contravention of this section he shall be liable—

(a) on summary conviction to a fine not exceeding the statutory maximum; and

(b) on conviction on indictment to imprisonment for a term not exceeding 2 years or to a fine of any amount or to both.

(5) In this section, references to the Department of Trade and Industry or the Statistics Board include references to any Northern Ireland department or to any part of the Scottish Administration carrying out similar functions.

Interpretative provisions

Taxation under the laws of other member States etc.

92

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Territories included in references to other member States etc.

93

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Meaning of “business” etc.

94

(1) In this Act “business” includes any trade, profession or vocation.

(2) Without prejudice to the generality of anything else in this Act, the following are deemed to be the carrying on of a business—

(a) the provision by a club, association or organisation (for a subscription or other consideration) of the facilities or advantages available to its members; and

(b) the admission, for a consideration, of persons to any premises.

(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(4) Where a person, in the course or furtherance of a trade, profession or vocation, accepts any office, services supplied by him as the holder of that office are treated as supplied in the course or furtherance of the trade, profession or vocation.

(5) Anything done in connection with the termination or intended termination of a business is treated as being done in the course or furtherance of that business.

(6) The disposition of a business , or part of a business, as a going concern, or of the assets or liabilities of the business or part of the business (whether or not in connection with its reorganisation or winding up), is a supply made in the course or furtherance of the business.

Meaning of “new means of transport”.

95

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Meaning of “online marketplace” and “operator” etc

95A

(1) In this Act—

“online marketplace” means a website, or any other means by which information is made available over the internet, which facilitates the sale of goods through the website or other means by persons other than the operator (whether or not the operator also sells goods through the marketplace);

“operator”, in relation to an online marketplace, means the person who controls access to, and the contents of, the online marketplace provided that the person is involved in—determining any terms or conditions applicable to the sale of goods,processing, or facilitating the processing, of payment for the goods, andthe ordering or delivery, or facilitating the ordering or delivery, of the goods.

(2) For the purposes of subsection (1), an online marketplace facilitates the sale of goods if it allows a person to—

(a) offer goods for sale, and

(b) enter into a contract for the sale of those goods.

(3) The Treasury may by regulations amend this section so as to alter the meaning of—

“online marketplace”, and

“operator”.

Other interpretative provisions.

96

(1) In this Act—

“the 1983 Act” means the Value Added Tax Act 1983;

“assignment”, in relation to Scotland, means assignation;

“authorised person” means any person acting under the authority of the Commissioners;

“the Commissioners” means the Commissioners of Customs and Excise;

“copy”, in relation to a document, means anything onto anything onto which information recorded in the document has been copied, by whatever means and whether directly or indirectly.

“document” means anything in which information of any description is recorded; and

“fee simple”—in relation to Scotland, means the ... interest of the owner;in relation to Northern Ireland, includes the estate of a person who holds land under a fee farm grant;

“HMRC” means Her Majesty’s Revenue and Customs;

“import duty” means import duty charged in accordance with Part 1 of TCTA 2018;

“invoice” includes any document similar to an invoice;

“input tax” has the meaning given by section 24;

“local authority” has the meaning given by subsection (4) below;

“major interest”, in relation to land, means the fee simple or a tenancy for a term certain exceeding 21 years, and in relation to Scotland means the interest of the owner, or the lessee’s interest under a lease for a period of not less than 20 years;

“the Management Act” means the Customs and Excise Management Act 1979;

“money” includes currencies other than sterling;

“output tax” has the meaning given by section 24;

“postal operator” means a person who provides—the service of conveying postal packets from one place to another by post, orany of the incidental services of receiving, collecting, sorting and delivering postal packets;

“postal packet” means a letter, parcel, packet or other article transmissible by post;

“prescribed” means prescribed by regulations:

“prescribed accounting period” has the meaning given by section 25(1);

“quarter” means a period of 3 months ending at the end of March, June, September or December;

“regulations” means regulations made by the Commissioners under this Act;

“relevant business person” has the meaning given by section 7A(4);

“ship” includes hovercraft;

“subordinate legislation” has the same meaning as in the Interpretation Act 1978;

“tax” means VAT;

“taxable person” means a person who is a taxable person under section 3;

“taxable supply” has the meaning given by section 4(2);

“the Taxes Act” means the Income and Corporation Taxes Act 1988;

“TCTA 2018” means the Taxation (Cross-border Trade) Act 2018;

“tribunal” has the meaning given by section 82;

“trustee in sequestration” means a trustee (or interim trustee) in a sequestration under the Bankruptcy (Scotland) Act 2016

“VAT” means value added tax charged in accordance with this Act;

“VAT credit” has the meaning given by section 25(3);

“VAT invoice” has the meaning given by section 6(15);

“VAT representative” has the meaning given by section 48;

and any reference to a particular section, Part or Schedule is a reference to that section or Part of, or Schedule to, this Act.

(2) Any reference in this Act to being registered shall be construed in accordance with section 3(3).

(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(4) In this Act “local authority” means the council of a county, county borough, district, London borough, parish or group of parishes (or, in Wales, community or group of communities), the Common Council of the City of London, the Council of the Isles of Scilly, and any joint committee or joint board established by two or more of the foregoing and, in relation to Scotland, a council constituted under section 2 of the Local Government etc. (Scotland) Act 1994, any two or more such councils and any joint committee or joint board within the meaning of section 235(1) of the Local Government (Scotland) Act 1973.

(5) Any reference in this Act to the amount of any duty of excise on any goods shall be taken to be a reference to the amount of duty charged on those goods with any addition or deduction falling to be made under section 1 of the Excise Duties (Surcharges or Rebates) Act 1979.

(6) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(7) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(8) The question whether, in relation to any supply of services, the supplier or the recipient of the supply belongs in one country or another shall be determined ... in accordance with section 9.

(9) Schedules 7A, 8 and 9 shall be interpreted in accordance with the notes contained in those Schedules; and accordingly the powers conferred by this Act to vary those Schedules include a power to add to, delete or vary those notes.

(10) The descriptions of Groups in those Schedules are for ease of reference only and shall not affect the interpretation of the descriptions of items in those Groups.

(10A) Where—

(a) the grant of any interest, right, licence or facilities gives rise for the purposes of this Act to supplies made at different times after the making of the grant, and

(b) a question whether any of those supplies is zero-rated or exempt falls to be determined according to whether or not the grant is a grant of a description specified in Schedule 8 or 9 or any of paragraphs 5 to 11 of Schedule 10,

that question shall be determined according to whether the description is applicable as at the time of supply, rather than by reference to the time of the grant.

(10B) Notwithstanding subsection (10A) above—

(a) item 1 of Group 1 of Schedule 9 does not make exempt any supply that arises for the purposes of this Act from the prior grant of a fee simple falling within paragraph (a) of that item; and

(b) that paragraph does not prevent the exemption of a supply that arises for the purposes of this Act from the prior grant of a fee simple not falling within that paragraph.

(11) References in this Act to the United Kingdom include the territorial sea of the United Kingdom.

Supplementary provisions

Orders, rules and regulations.

97

(1) Any order made by the Treasury ... under this Act and any regulations or rules under this Act shall be made by statutory instrument.

(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) An order to which this subsection applies shall be laid before the House of Commons; and unless it is approved by that House before the expiration of a period of 28 days beginning with the date on which it was made, it shall cease to have effect on the expiration of that period, but without prejudice to anything previously done thereunder or to the making of a new order.

In reckoning any such period no account shall be taken of any time during which Parliament is dissolved or prorogued or during which the House of Commons is adjourned for more than 4 days.

(4) Subject to section 53(4), subsection (3) above applies to—

(aa) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(a) an order under section 5(4) , 7A(6) or 28 , 28 or 40A;

(ab) an order under paragraph 5(7) of Schedule 4 substituting a lesser sum for the sum for the time being specified in paragraph 5(2)(a) of that Schedule;

(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(i) for increasing the rate of VAT in force under section 2 at the time of the making of the order;

(ii) for excluding any VAT from credit under section 25;

(iia) for varying Schedule 7A so as to cause VAT to be charged on a supply at the rate in force under section 2 instead of that in force under section 29A;

(iii) for varying Schedule 8 or 9 so as to abolish the zero-rating of a supply or to abolish the exemption of a supply without zero-rating it;

(ca) an order under section 43AA(1) if as a result of the order any persons would cease to be eligible to be treated as members of a group;

(d) an order under section 51, except one making only such amendments as are necessary or expedient in consequence of provisions of an order under this Act which—

(i) vary Schedule [7A,] 8 or 9; but

(ii) are not within paragraph (c) above;

(e) an order under section 54(4) or (8).

(ea) an order under section 55A(13);

(eb) an order under section 77A(9) or (9A);

(f) an order under paragraph B1, C1(4), 1A(7), 2A(4) or 8A(7) of Schedule 6;

(fa) an order under paragraph 3(4) of Schedule 10A;

(g) an order under paragraph 3 or 4 of Schedule 11A.

(4A) Where an order under section 2(2) is in force, the reference in subsection (4)(c)(i) of this section to the rate of VAT in force under section 2 at the time of the making of an order is a reference to the rate which would be in force at that time if no such order had been made.

(5) A statutory instrument made under any provision of this Act except—

(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(b) an instrument as respects which any other Parliamentary procedure is expressly provided, or

(c) an instrument containing an order appointing a day for the purposes of any provision of this Act, being a day as from which the provision will have effect, with or without amendments, or will cease to have effect,

shall be subject to annulment in pursuance of a resolution of the House of Commons.

Place of supply orders: transitional provision.

97A

(1) This section shall have effect for the purpose of giving effect to any order made under section 7A(6), if—

(a) the order provides for services of a description specified in the order to be treated as supplied in the United Kingdom;

(b) the services would not have fallen to be so treated apart from the order;

(c) the services are not services that would have fallen to be so treated under any provision re-enacted in the order; and

(d) the order is expressed to come into force in relation to services supplied on or after a date specified in the order (“the commencement date”).

(2) Invoices and other documents provided to any person before the commencement date shall be disregarded in determining the time of the supply of any services which, if their time of supply were on or after the commencement date, would be treated by virtue of the order as supplied in the United Kingdom.

(3) If there is a payment in respect of any services of the specified description that was received by the supplier before the commencement date, so much (if any) of that payment as relates to times on or after that date shall be treated as if it were a payment received on the commencement date.

(4) If there is a payment in respect of services of the specified description that is or has been received by the supplier on or after the commencement date, so much (if any) of that payment as relates to times before that date shall be treated as if it were a payment received before that date.

(5) Subject to subsection (6) below, a payment in respect of any services shall be taken for the purposes of this section to relate to the time of the performance of those services.

(6) Where a payment is received in respect of any services the performance of which takes place over a period a part of which falls before the commencement date and a part of which does not—

(a) an apportionment shall be made, on a just and reasonable basis, of the extent to which the payment is attributable to so much of the performance of those services as took place before that date;

(b) the payment shall, to that extent, be taken for the purposes of this section to relate to a time before that date; and

Service of notices.

98

Any notice, notification, requirement or demand to be served on, given to or made of any person for the purposes of this Act may be served, given or made by sending it by post in a letter addressed to that person or his VAT representative at the last or usual residence or place of business of that person or representative.

Refund of VAT to Government of Northern Ireland.

99

The Commissioners shall refund to the Government of Northern Ireland the amount of the VAT charged on the supply of goods or services to that Government ... or on the importation of any goods by that Government ..., after deducting therefrom so much of that amount as may be agreed between them and the Department of Finance and Personnel for Northern Ireland as attributable to supplies ... and importations for the purpose of a business carried on by the Government of Northern Ireland.

Savings and transitional provisions, consequential amendments and repeals.

100

(1) Schedule 13 (savings and transitional provisions) and Schedule 14 (consequential amendments) shall have effect.

(2) The enactments and Orders specified in Schedule 15 are hereby repealed to the extent mentioned in the third column of that Schedule.

(3) This section is without prejudice to the operation of sections 15 to 17 of the Interpretation Act 1978 (which relate to the effect of repeals).

Commencement and extent.

101

(1) This Act shall come into force on 1st September 1994 and Part I shall have effect in relation to the charge to VAT on supplies, acquisitions and importations in prescribed accounting periods ending on or after that date.

(2) Without prejudice to section 16 of the Interpretation Act 1978 (continuation of proceedings under repealed enactments) except in so far as it enables proceedings to be continued under repealed enactments, section 72 shall have effect on the commencement of this Act to the exclusion of section 39 of the 1983 Act.

(3) This Act extends to Northern Ireland.

(4) Paragraph 23 of Schedule 13 and paragraph 7 of Schedule 14 shall extend to the Isle of Man but no other provision of this Act shall extend there.

Short title.

102

This Act may be cited as the Value Added Tax Act 1994.

SCHEDULE A1

The supplies

1

(1) Subject to the following provisions of this Schedule, the supplies falling within this paragraph are—

(a) supplies for qualifying use of—

(i) coal, coke, or other solid substances held out for sale solely as fuel;

(ii) coal gas, water gas, producer gases or similar gases;

(iii) petroleum gases, or other gaseous hydrocarbons, whether in a gaseous or liquid state;

(iv) fuel oil, gas oil or kerosene; or

(v) electricity, heat or air-conditioning;

(aa) supplies of services of installing List A energy-saving materials in residential accommodation or in a building intended for use solely for a relevant charitable purpose;

(ab) supplies of List A energy-saving materials by a person who installs those materials in residential accommodation or a building intended for use solely for a relevant charitable purpose;

(b) supplies to a qualifying person of any services of installing List B energy-saving materials in the qualifying person’s sole or main residence; . . .

(c) supplies of List B energy-saving materials made to a qualifying person by a person who installs those materials in the qualifying person’s sole or main residence.

(d) supplies to a qualifying person of services of connecting, or reconnecting, a mains gas supply to the qualifying person’s sole or main residence;

(e) supplies of goods made to a qualifying person by a person connecting, or reconnecting, a mains gas supply to the qualifying person’s sole or main residence, being goods whose installation is necessary for the connection, or reconnection, of the mains gas supply;

(f) supplies to a qualifying person of services of installing, maintaining or repairing a central heating system in the qualifying person’s sole or main residence;

(g) supplies of goods made to a qualifying person by a person installing, maintaining or repairing a central heating system in the qualifying person’s sole or main residence, being goods whose installation is necessary for the installation, maintenance or repair of the central heating system;

(h) supplies consisting in the leasing of goods that form the whole or part of a central heating system installed in the sole or main residence of a qualifying person;

(i) supplies of goods that form the whole or part of a central heating system installed in a qualifying person’s sole or main residence and that, immediately before being supplied, were goods leased under arrangements such that the consideration for the supplies consisting in the leasing of the goods was, in whole or in part, funded by a grant made under a relevant scheme;

(j) supplies to a qualifying person of services of installing qualifying security goods in the qualifying person’s sole or main residence; and

(k) supplies of qualifying security goods made to a qualifying person by a person who installs those goods in the qualifying person’s sole or main residence.

(1A) A supply to which any of paragraphs (b) to (k) of sub-paragraph (1) above applies is a supply falling within this paragraph only to the extent that the consideration for it—

(a) is, or is to be, funded by a grant made under a relevant scheme; or

(b) in the case of a supply to which paragraph (i) of that sub-paragraph applies—

(i) is, or is to be, funded by such a grant, or

(ii) is a payment becoming due only by reason of the termination (whether by the passage of time or otherwise) of the leasing of the goods in question.

(1B) Where a grant is made under a relevant scheme in order to fund a supply of a description falling within any of paragraphs (b) to (k) of sub-paragraph (1) above (“the relevant supply”) and also to fund a supply to which none of those paragraphs applies (“the non-relevant supply”) then the proportion of the grant that is to be attributed, for the purposes of sub-paragraph (1A) above, to the relevant supply shall be the same proportion as the consideration reasonably attributable to that supply bears to the consideration for that supply and for the non-relevant supply.

(2) In this paragraph “qualifying use” means—

(a) domestic use; or

(b) use by a charity otherwise than in the course or furtherance of a business.

(3) Where there is a supply of goods partly for qualifying use and partly not—

(a) if at least 60 per cent. of the goods are supplied for qualifying use, the whole supply shall be treated as a supply for qualifying use; and

(b) in any other case, an apportionment shall be made to determine the extent to which the supply is a supply for qualifying use.

(4) The supplies falling within this paragraph also include supplies of women’s sanitary protection products.

(5) The supplies falling within this paragraph also include supplies of children’s car seats.

(6) The supplies falling within this paragraph also include—

(a) the supply, in the course of a qualifying conversion, of qualifying services related to the conversion;

(b) the supply of building materials if—

(i) the materials are supplied by a person who, in the course of a qualifying conversion, is supplying qualifying services related to the conversion, and

(ii) those services include the incorporation of the materials in the building concerned or its immediate site.

(7) The supplies falling within this paragraph also include—

(a) the supply, in the course of the renovation or alteration of a single household dwelling, of qualifying services related to the renovation or alteration;

(b) the supply of building materials if—

(i) the materials are supplied by a person who, in the course of the renovation or alteration of a single household dwelling, is supplying qualifying services related to the renovation or alteration, and

(ii) those services include the incorporation of the materials in the dwelling concerned or its immediate site.

(8) Sub-paragraph (9) below applies where a supply of services is only in part a supply to which sub-paragraph (6)(a) or (7)(a) above applies.

(9) The supply, to the extent that it is one to which paragraph (a) of sub-paragraph (6) or (7) above applies, is to be taken to be a supply to which that paragraph applies; and an apportionment may be made to determine that extent.

Interpretation

2

For the purposes of this Schedule the following supplies are always for domestic use—

(a) a supply of not more than one tonne of coal or coke held out for sale as domestic fuel;

(b) a supply of wood, peat or charcoal not intended for sale by the recipient;

(c) a supply to a person at any premises of piped gas (that is, gas within paragraph 1(1)(a)(ii) above, or petroleum gas in a gaseous state, provided through pipes) where the gas (together with any other piped gas provided to him at the premises by the same supplier) was not provided at a rate exceeding 150 therms a month or, if the supplier charges for the gas by reference to the number of kilowatt hours supplied, 4397 kilowatt hours a month;

(d) a supply of petroleum gas in a liquid state where the gas is supplied in cylinders the net weight of each of which is less than 50 kilogrammes and either the number of cylinders supplied is 20 or fewer or the gas is not intended for sale by the recipient;

(e) a supply of petroleum gas in a liquid state, otherwise than in cylinders, to a person at any premises at which he is not able to store more than two tonnes of such gas;

(f) a supply of not more than 2,300 litres of fuel oil, gas oil or kerosene;

(g) a supply of electricity to a person at any premises where the electricity (together with any other electricity provided to him at the premises by the same supplier) was not provided at a rate exceeding 1000 kilowatt hours a month.

3

(1) For the purposes of this Schedule supplies not within paragraph 2 above are for domestic use if and only if the goods supplied are for use in—

(a) a building, or part of a building, which consists of a dwelling or number of dwellings;

(b) a building, or part of a building, used for a relevant residential purpose;

(d) a caravan; or

(e) a houseboat.

(2) For the purposes of this Schedule use for a relevant residential purpose means use as—

(a) a home or other institution providing residential accommodation for children;

(b) a home or other institution providing residential accommodation with personal care for persons in need of personal care by reason of old age, disablement, past or present dependence on alcohol or drugs or past or present mental disorder;

(d) residential accommodation for students or school pupils;

(e) residential accommodation for members of any of the armed forces;

(f) a monastery, nunnery or similar establishment; or

(g) an institution which is the sole or main residence of at least 90 per cent. of its residents,

except use as a hospital, a prison or similar institution or an hotel or inn or similar establishment.

(3) For the purposes of this Schedule self-catering holiday accommodation includes any accommodation advertised or held out as such.

(4) In this Schedule “houseboat” means a boat or other floating decked structure designed or adapted for use solely as a place of permanent habitation and not having means of, or capable of being readily adapted for, self-propulsion.

4

(1) Paragraph 1(1)(a) (i)above shall be deemed to include combustible materials put up for sale for kindling fires but shall not include matches.

(2) Paragraph 1(1)(a)(ii) and (iii) above shall not include any road fuel gas (within the meaning of the Hydrocarbon Oil Duties Act 1979) on which a duty of excise has been charged or is chargeable.

(3) Paragraph 1(1)(a)(iv) above shall not include hydrocarbon oil on which a duty of excise has been or is to be charged without relief from, or rebate of, such duty by virtue of the provisions of the Hydrocarbon Oil Duties Act 1979.

(4) In this Schedule “fuel oil” means heavy oil which contains in solution an amount of asphaltenes of not less than 0.5 per cent. or which contains less than 0.5 per cent. but not less than 0.1 per cent. of asphaltenes and has a closed flash point not exceeding 150°C.

(5) In this Schedule “gas oil” means heavy oil of which not more than 50 per cent. by volume distils at a temperature not exceeding 240°C and of which more than 50 per cent. by volume distils at a temperature not exceeding 340°C.

(6) In this Schedule “kerosene” means heavy oil of which more than 50 per cent. by volume distils at a temperature not exceeding 240°C.

(7) In this Schedule “heavy oil” shall have the same meaning as in the Hydrocarbon Oil Duties Act 1979.

5

(1) For the purposes of this paragraph—

(a) “the Contributions and Benefits Act” means the Social Security Contributions and Benefits Act 1992 ; and

(b) “the Northern Ireland Act” means the Social Security Contributions and Benefits (Northern Ireland) Act 1992 .

(2) For the purposes of paragraph 1(1) above a person to whom a supply is made is “a qualifying person” if at the time of the supply he—

(a) is aged 60 or over; or

(b) is in receipt of one or more of the benefits mentioned in sub-paragraph (3) below.

(3) The benefits referred to in sub-paragraph (2) above are as follows—

(a) council tax benefit under Part VII of the Contributions and Benefits Act;

(b) disability living allowance under Part III of the Contributions and Benefits Act or Part III of the Northern Ireland Act;

(c) disabled person’s tax credit under Part VII of the Contributions and Benefits Act or Part VII of the Northern Ireland Act;

(d) working families’ tax credit under Part VII of the Contributions and Benefits Act or Part VII of the Northern Ireland Act;

(e) housing benefit under Part VII of the Contributions and Benefits Act or Part VII of the Northern Ireland Act;

(f) an income-based jobseeker’s allowance within the meaning of section 1(4) of the Jobseekers Act 1995 or Article 3(4) of the Jobseekers (Northern Ireland) Order 1995 ;

(g) income support under Part VII of the Contributions and Benefits Act or Part VII of the Northern Ireland Act;

(h) disablement pension under Part V of the Contributions and Benefits Act or Part V of the Northern Ireland Act, which is payable at the increased rate provided for under section 104 (constant attendance allowance) of the Act concerned; and

(i) war disablement pension under the Naval, Military and Air Forces Etc. (Disablement and Death) Service Pensions Order 1983 , which is payable at the increased rate provided for under article 14 (constant attendance allowance) or article 26A (mobility supplement) of that Order.

(3A) For the purposes of paragraph 1(1)(aa) and (ab) above “ residential accommodation ” means—

(a) a building, or part of a building, that consists of a dwelling or a number of dwellings;

(b) a building, or part of a building, used for a relevant residential purpose;

(d) a houseboat.

(3B) For the purposes of paragraph 1(1)(aa) and (ab) above “ use for a relevant charitable purpose ” means use by a charity in either or both of the following ways, namely—

(a) otherwise than in the course or furtherance of a business;

(b) as a village hall or similarly in providing social or recreational facilities for a local community.

(4) For the purposes of paragraph 1(1)(aa) and (ab) above “List A energy-saving materials” means any of the following—

(a) insulation for walls, floors, ceilings, roofs or lofts or for water tanks, pipes or other plumbing fittings;

(b) draught stripping for windows and doors;

(d) hot water system controls.

(e) solar panels;

(f) wind turbines;

(g) water turbines.

(4A) For the purposes of paragraph 1(1)(b) and (c) above “ List B energy-saving materials ” means any of the following—

(a) gas-fired room heaters that are fitted with thermostatic controls;

(b) electric storage heaters;

(d) electric dual immersion water heaters with foam-insulated hot water tanks;

(e) gas-fired boilers;

(f) oil-fired boilers;

(g) radiators.

(4B) For the purposes of paragraph 1(1)(j) and (k) above, “ qualifying security goods ” means any of the following—

(a) locks or bolts for windows;

(b) locks, bolts or security chains for doors;

(d) smoke alarms.

(5) For the purposes of paragraph 1 above a scheme is a “relevant scheme” if it is one which—

(a) has as one of its objectives the funding of the installation of energy-saving materials in the homes of any persons who are qualifying persons, and

(b) disburses, whether directly or indirectly, its grants in whole or in part out of funds made available to it in order to achieve that objective—

(i) by the Secretary of State,

(ii) by the European Community,

(iii) under an arrangement approved by the Director General of Electricity Supply, the Director General of Electricity Supply for Northern Ireland or the Director General of Gas Supply, or

(iv) by a local authority .

6

(1) In paragraph 1(4) above “women’s sanitary protection products” means women’s sanitary protection products of any of the following descriptions—

(a) subject to sub-paragraph (2) below, products that are designed, and marketed, as being solely for use for absorbing, or otherwise collecting, lochia or menstrual flow;

(b) panty liners, other than panty liners that are designed as being primarily for use as incontinence products;

(2) Sub-paragraph (1)(a) above does not include protective briefs or any other item of clothing.

Interpretation of paragraph 1(5)

7

(1) Paragraph 1(5) above is interpreted in accordance with the provisions of this paragraph.

(2) The following are “ children’s car seats ”—

(a) a safety seat;

(b) the combination of a safety seat and a related wheeled framework;

(d) a booster cushion.

(3) In this paragraph “ safety seat ” means a seat—

(a) designed to be sat in by a child in a road vehicle,

(b) designed so that, when in use in a road vehicle, it can be restrained—

(i) by a seat belt fitted in the vehicle, or

(ii) by belts, or anchorages, that form part of the seat being attached to the vehicle, or

(iii) in either of those ways, and

(4) For the purposes of this paragraph, a wheeled framework is “ related ” to a safety seat if the framework and the seat are each designed so that—

(a) when the seat is not in use in a road vehicle it can be attached to the framework, and

(b) when the seat is so attached, the combination of the seat and the framework can be used as a child’s pushchair.

(5) In this paragraph “ booster seat ” means a seat designed—

(a) to be sat in by a child in a road vehicle, and

(b) so that, when in use in a road vehicle, it and a child seated in it can be restrained by a seat belt fitted in the vehicle.

(6) In this paragraph “ booster cushion ” means a cushion designed—

(a) to be sat on by a child in a road vehicle, and

(b) so that a child seated on it can be restrained by a seat belt fitted in the vehicle.

(7) In this paragraph “ child ” means a person aged under 14 years.

Interpretation of paragraph 1(6): introductory

8

(1) Paragraph 1(6) above is interpreted in accordance with paragraphs 9 to 17 and 22 below.

(2) In paragraphs 10 to 14 below, “ single household dwelling ” means a dwelling—

(a) that is designed for occupation by a single household, and

(b) in relation to which the conditions set out in sub-paragraph (4) below are satisfied.

(3) In paragraphs 10 to 14 below “ multiple occupancy dwelling ” means a dwelling—

(a) that is designed for occupation by persons not forming a single household, and

(b) in relation to which the conditions set out in sub-paragraph (4) below are satisfied.

(4) The conditions are—

(a) that the dwelling consists of self-contained living accommodation,

(b) that there is no provision for direct internal access from the dwelling to any other dwelling or part of a dwelling,

(c) that the separate use of the dwelling is not prohibited by the terms of any covenant, statutory planning consent or similar provision, and

(d) that the separate disposal of the dwelling is not prohibited by any such terms.

(5) For the purposes of this paragraph, a dwelling “ is designed ” for occupation of a particular kind if it is so designed—

(a) as a result of having been originally constructed for occupation of that kind and not having been subsequently adapted for occupation of any other kind, or

(b) as a result of adaptation.

Interpretation of paragraph 1(6): meaning of “qualifying conversion”

9

(1) A “qualifying conversion” means—

(a) a changed number of dwellings conversion (see paragraph 10 below);

(b) house in multiple occupation conversion (see paragraph 11 below); or

(2) Sub-paragraph (1) above is subject to paragraphs 14 and 15 below.

Interpretation of paragraph 1(6): meaning of “changed number of dwellings conversion”

10

(1) A “changed number of dwellings conversion” is—

(a) a conversion of premises consisting of a building where the conditions specified in this paragraph are satisfied, or

(b) a conversion of premises consisting of a part of a building where those conditions are satisfied.

(2) The first condition is that after the conversion the premises being converted contain a number of single household dwellings that is—

(a) different from the number (if any) that the premises contain before the conversion, and

(b) greater than, or equal to, one.

(3) The second condition is that there is no part of the premises being converted that is a part that after the conversion contains the same number of single household dwellings (whether zero, one or two or more) as before the conversion.

Interpretation of paragraph 1(6): meaning of “house in multiple occupation conversion”

11

(1) A “house in multiple occupation conversion” is—

(a) a conversion of premises consisting of a building where the condition specified in sub-paragraph (2) below is satisfied, or

(b) a conversion of premises consisting of a part of a building where that condition is satisfied.

(2) The condition is that—

(a) before the conversion the premises being converted contain only a single household dwelling or two or more such dwellings,

(b) after the conversion those premises contain only a multiple occupancy dwelling or two or more such dwellings, and

(c) the use to which those premises are intended to be put after the conversion is not to any extent use for a qualifying residential purpose (see paragraph 17 below).

Interpretation of paragraph 1(6): meaning of “special residential conversion”

12

(1) A “special residential conversion” is a conversion of premises consisting of—

(a) a building or two or more buildings,

(b) a part of a building or two or more parts of buildings, or

(i) a building or two or more buildings, and

(ii) a part of a building or two or more parts of buildings,

where the conditions specified in this paragraph are satisfied.

(2) The first condition is that, before the conversion, the premises being converted contain only—

(a) a dwelling or two or more dwellings, or

(b) a dwelling, or two or more dwellings, and—

(i) an ancillary outbuilding occupied together with the dwelling or one or more of the dwellings, or

(ii) two or more ancillary outbuildings each occupied together with the dwelling or one or more of the dwellings.

(3) In sub-paragraph (2) above “dwelling” means single household dwelling or multiple occupancy dwelling.

(4) The second condition is that where before the conversion the premises being converted contain a multiple occupancy dwelling or two or more such dwellings, the use to which that dwelling, or any of those dwellings, was last put before the conversion was not to any extent use for a qualifying residential purpose (see paragraph 17 below).

(5) The third condition is that the premises being converted must be intended to be used after the conversion solely for a qualifying residential purpose.

(6) The fourth condition is that, where the qualifying residential purpose is an institutional purpose, the premises being converted must be intended to form after the conversion the entirety of an institution used for that purpose.

(7) In sub-paragraph (6) above “institutional purpose” means a purpose within paragraph 17(a) to (c), (f) or (g) below.

Special residential conversions: reduced rate only for supplies made to intended user of converted accommodation

13

(1) This paragraph applies where the qualifying conversion concerned is a special residential conversion.

(2) Paragraph 1(6)(a) or (b) above does not apply to a supply unless—

(a) it is made to a person who intends to use the premises being converted for the qualifying residential purpose, and

(b) before it is made, the person to whom it is made has given to the person making it a certificate that satisfies the requirements in sub-paragraph (3) below.

(3) Those requirements are that the certificate—

(a) is in such form as may be specified in a notice published by the Commissioners, and

(b) states that the conversion is a special residential conversion.

(4) In sub-paragraph (2)(a) above “the qualifying residential purpose” means the purpose within paragraph 17 below for which the premises being converted are intended to be used after the conversion.

14

(1) A qualifying conversion includes any garage works related to the—

(a) changed number of dwellings conversion,

(b) house in multiple occupation conversion, or

concerned.

(2) In this paragraph “garage works” means—

(a) the construction of a garage, or

(b) a conversion of a non-residential building, or of a non-residential part of a building, that results in a garage.

(3) For the purposes of sub-paragraph (1) above, garage works are “related” to a conversion if—

(a) they are carried out at the same time as the conversion, and

(b) the resulting garage is intended to be occupied with—

(i) where the conversion concerned is a changed number of dwellings conversion, a single household dwelling that will after the conversion be contained in the building, or part of a building, being converted,

(ii) where the conversion concerned is a house in multiple occupation conversion, a multiple occupancy dwelling that will after the conversion be contained in the building, or part of a building, being converted, or

(iii) where the conversion concerned is a special residential conversion, the institution or other accommodation resulting from the conversion.

(4) In sub-paragraph (2) above “non-residential” means neither designed, nor adapted, for use—

(a) as a dwelling or two or more dwellings, or

(b) for a qualifying residential purpose (see paragraph 17 below).

15

(1) A conversion is not a qualifying conversion if any statutory planning consent needed for the conversion has not been granted.

(2) A conversion is not a qualifying conversion if any statutory building control approval needed for the conversion has not been granted.

Interpretation of paragraph 1(6): meaning of “supply of qualifying services”

16

(1) In the case of a conversion of a building, “supply of qualifying services” means a supply of services that consists in—

(a) the carrying out of works to the fabric of the building, or

(b) the carrying out of works within the immediate site of the building that are in connection with—

(i) the means of providing water, power, heat or access to the building,

(ii) the means of providing drainage or security for the building, or

(iii) the provision of means of waste disposal for the building.

(2) In the case of a conversion of part of a building, “supply of qualifying services” means a supply of services that consists in—

(a) the carrying out of works to the fabric of the part, or

(b) the carrying out of works to the fabric of the building, or within the immediate site of the building, that are in connection with—

(i) the means of providing water, power, heat or access to the part,

(ii) the means of providing drainage or security for the part, or

(iii) the provision of means of waste disposal for the part.

(3) In this paragraph—

(a) references to the carrying out of works to the fabric of a building do not include the incorporation, or installation as fittings, in the building of any goods that are not building materials (see paragraph 22 below);

(b) references to the carrying out of works to the fabric of a part of a building do not include the incorporation, or installation as fittings, in the part of any goods that are not building materials.

Interpretation of paragraphs 11 to 14: meaning of “qualifying residential purpose”

17

For the purposes of paragraphs 11 to 14 above, “use for a qualifying residential purpose” means use as—

(a) a home or other institution providing residential accommodation for children,

(b) a home or other institution providing residential accommodation with personal care for persons in need of personal care by reason of old age, disablement, past or present dependence on alcohol or drugs or past or present mental disorder,

(d) residential accommodation for students or school pupils,

(e) residential accommodation for members of any of the armed forces,

(f) a monastery, nunnery or similar establishment, or

(g) an institution which is the sole or main residence of at least 90 per cent. of its residents,

except use as a hospital, prison or similar institution or an hotel, inn or similar establishment.

Interpretation of paragraph 1(7): introductory

18

(1) Paragraph 1(7) above is interpreted in accordance with this paragraph and paragraphs 19 to 22 below.

(2) For the purposes of paragraph 1(7) above (and paragraphs 19 to 21 below)—

“alteration” includes extension;

“single household dwelling” has the meaning given by paragraph 8(2), (4) and (5) above.

Paragraph 1(7) only applies where dwelling has been empty for at least 3 years

19

(1) Paragraph 1(7) above does not apply to a supply unless either of the empty home conditions is satisfied.

(2) The first “empty home condition” is that the dwelling concerned has not been lived in during the period of 3 years ending with the commencement of the relevant works.

(3) The second “empty home condition” is that—

(a) the dwelling was not lived in during a period of at least 3 years;

(b) the person, or one of the persons, whose beginning to live in the dwelling brought that period to an end was a person who (whether alone or jointly with another or others) acquired the dwelling at a time—

(i) no later than the end of that period, and

(ii) when the dwelling had been not lived in for at least 3 years;

(c) no works by way of renovation or alteration were carried out to the dwelling during the period of 3 years ending with the acquisition;

(d) the supply is made to a person who is—

(i) the person, or one of the persons, whose beginning to live in the property brought to an end the period mentioned in paragraph (a) above, and

(ii) the person, or one of the persons, who acquired the dwelling as mentioned in paragraph (b) above; and

(e) the relevant works are carried out during the period of one year beginning with the day of the acquisition.

(4) In this paragraph “the relevant works” means—

(a) where the supply is of the description set out in paragraph 1(7)(a) above, the works that constitute the services supplied;

(b) where the supply is of the description set out in paragraph 1(7)(b) above, the works by which the materials concerned are incorporated in the dwelling concerned or its immediate site.

(5) In sub-paragraph (3) above, references to a person acquiring a dwelling are to that person having a major interest in the dwelling granted, or assigned, to him for a consideration.

20

(1) Paragraph 1(7) above does not apply to a supply unless any statutory planning consent needed for the renovation or alteration has been granted.

(2) Paragraph 1(7) above does not apply to a supply unless any statutory building control approval needed for the renovation or alteration has been granted.

Interpretation of paragraph 1(7): meaning of “supply of qualifying services”

21

(1) “Supply of qualifying services” means a supply of services that consists in—

(a) the carrying out of works to the fabric of the dwelling, or

(b) the carrying out of works within the immediate site of the dwelling that are in connection with—

(i) the means of providing water, power, heat or access to the dwelling,

(ii) the means of providing drainage or security for the dwelling, or

(iii) the provision of means of waste disposal for the dwelling.

(2) In sub-paragraph (1)(a) above, the reference to the carrying out of works to the fabric of the dwelling does not include the incorporation, or installation as fittings, in the dwelling of any goods that are not building materials (see paragraph 22 below).

Interpretation of paragraph 1(6) and (7): meaning of “building materials”

22

“Building materials” has the meaning given by Notes (22) and (23) of Group 5 to Schedule 8 (zero-rating of construction and conversion of buildings).

SCHEDULE 1

Liability to be registered

1

(1) Subject to sub-paragraphs (3) to (7) below, a person who makes taxable supplies but is not registered under this Act becomes liable to be registered under this Schedule—

(a) at the end of any month, if the person is UK-established and the value of his taxable supplies in the period of one year then ending has exceeded £90,000; or

(b) at any time, if the person is UK-established and there are reasonable grounds for believing that the value of his taxable supplies in the period of 30 days then beginning will exceed £90,000.

(2) Where a business , or part of a business, carried on by a taxable person is transferred to another person as a going concern, the transferee is UK-established at the time of the transfer and the transferee is not registered under this Act at that time, then, subject to sub-paragraphs (3) to (7) below, the transferee becomes liable to be registered under this Schedule at that time if—

(a) the value of his taxable supplies in the period of one year ending at the time of the transfer has exceeded £90,000; or

(b) there are reasonable grounds for believing that the value of his taxable supplies in the period of 30 days beginning at the time of the transfer will exceed £90,000.

(2A) In determining the value of a person's supplies for the purposes of sub-paragraph (1)(a) or (2)(a), supplies are to be taken into account (subject to sub-paragraphs (3) to (7)) whether or not the person was UK-established when they were made.

(3) A person does not become liable to be registered by virtue of sub-paragraph (1)(a) or (2)(a) above if the Commissioners are satisfied that the value of his taxable supplies in the period of one year beginning at the time at which, apart from this sub-paragraph, he would become liable to be registered will not exceed £88,000.

(4) In determining the value of a person’s supplies for the purposes of sub-paragraph (1)(a) or (2)(a) above, supplies made at a time when he was previously registered under this Act shall be disregarded if—

(a) his registration was cancelled otherwise than under paragraph 13(3) below, paragraph 11 of Schedule 1A... or paragraph 6(2) of Schedule 3A, and

(b) the Commissioners are satisfied that before his registration was cancelled he had given them all the information they needed in order to determine whether to cancel the registration.

(5) A person shall be treated as having become liable to be registered under this Schedule at any time when he would have become so liable under the preceding provisions of this paragraph but for any registration which is subsequently cancelled under paragraph 13(3) below, paragraph 11 of Schedule 1A... or paragraph 6(2) of Schedule 3A.

(6) A person shall not cease to be liable to be registered under this Schedule except in accordance with paragraph 2(5), 3 or 4 below.

(7) In determining the value of a person’s supplies for the purposes of sub-paragraph (1) or (2) above, supplies of goods or services that are capital assets of the business in the course or furtherance of which they are supplied ... shall be disregarded.

(8) Where, apart from this sub-paragraph, an interest in, right over or licence to occupy any land would under sub-paragraph (7) above be disregarded for the purposes of sub-paragraph (1) or (2) above, it shall not be if it is supplied on a taxable supply which is not zero-rated.

(9) In determining the value of a person’s supplies for the purposes of sub-paragraph (1) or (2) above, supplies to which section 18B(4) (last ... supply of goods before removal from fiscal warehousing) applies and supplies treated as made by him under section 18C(3) (self-supply of services on removal of goods from warehousing) shall be disregarded.

(10) A person is “UK-established” if the person has a business establishment, or some other fixed establishment, in the United Kingdom in relation to a business carried on by the person.

1A

(1) Paragraph 2 below is for the purpose of preventing the maintenance or creation of any artificial separation of business activities carried on by two or more persons from resulting in an avoidance of VAT.

(2) In determining for the purposes of sub-paragraph (1) above whether any separation of business activities is artificial, regard shall be had to the extent to which the different persons carrying on those activities are closely bound to one another by financial, economic and organisational links.

2

(1) Without prejudice to paragraph 1 above, if the Commissioners make a direction under this paragraph, the persons named in the direction shall be treated as a single taxable person carrying on the activities of a business described in the direction and that taxable person shall be liable to be registered under this Schedule with effect from the date of the direction or, if the direction so provides, from such later date as may be specified therein.

(2) The Commissioners shall not make a direction under this paragraph naming any person unless they are satisfied—

(a) that he is making or has made taxable supplies; and

(b) that the activities in the course of which he makes or made those taxable supplies form only part of certain activities . . ., the other activities being carried on concurrently or previously (or both) by one or more other persons; and

(c) that, if all the taxable supplies of the business described in the direction were taken into account, a person carrying on that business would at the time of the direction be liable to be registered by virtue of paragraph 1 above; . . .

(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3) A direction made under this paragraph shall be served on each of the persons named in it.

(4) Where, after a direction has been given under this paragraph specifying a description of business, it appears to the Commissioners that a person who was not named in that direction is making taxable supplies in the course of activities which should . . . be regarded as part of the activities of that business, the Commissioners may make and serve on him a supplementary direction referring to the earlier direction and the description of business specified in it and adding that person’s name to those of the persons named in the earlier direction with effect from—

(a) the date on which he began to make those taxable supplies, or

(b) if it was later, the date with effect from which the single taxable person referred to in the earlier direction became liable to be registered under this Schedule.

(5) If, immediately before a direction (including a supplementary direction) is made under this paragraph, any person named in the direction is registered in respect of the taxable supplies made by him as mentioned in sub-paragraph (2) or (4) above, he shall cease to be liable to be so registered with effect from whichever is the later of—

(a) the date with effect from which the single taxable person concerned became liable to be registered; and

(b) the date of the direction.

(6) In relation to a business specified in a direction under this paragraph, the persons named in the direction, together with any person named in a supplementary direction relating to that business (being the persons who together are to be treated as the taxable person), are in sub-paragraphs (7) and (8) below referred to as “the constituent members”.

(7) Where a direction is made under this paragraph then, for the purposes of this Act—

(a) the taxable person carrying on the business specified in the direction shall be registerable in such name as the persons named in the direction may jointly nominate by notice in writing given to the Commissioners not later than 14 days after the date of the direction or, in default of such a nomination, in such name as may be specified in the direction;

(b) any supply of goods or services by or to one of the constituent members in the course of the activities of the taxable person shall be treated as a supply by or to that person;

(d) each of the constituent members shall be jointly and severally liable for any VAT due from the taxable person;

(e) without prejudice to paragraph (d) above, any failure by the taxable person to comply with any requirement imposed by or under this Act shall be treated as a failure by each of the constituent members severally; and

(f) subject to paragraphs (a) to (e) above, the constituent members shall be treated as a partnership carrying on the business of the taxable person and any question as to the scope of the activities of that business at any time shall be determined accordingly.

(8) If it appears to the Commissioners that any person who is one of the constituent members should no longer be regarded as such for the purposes of paragraphs (d) and (e) of sub-paragraph (7) above and they give notice to that effect, he shall not have any liability by virtue of those paragraphs for anything done after the date specified in that notice and, accordingly, on that date he shall be treated as having ceased to be a member of the partnership referred to in paragraph (f) of that sub-paragraph.

3

A person who has become liable to be registered under this Schedule shall cease to be so liable at any time if the Commissioners are satisfied in relation to that time that he—

(a) has ceased to make taxable supplies; or

(b) is not at that time a person in relation to whom any of the conditions specified in paragraphs 1(1)(a) and (b) and (2)(a) and (b) above is satisfied; or

4

(1) Subject to sub-paragraph (2) below, a person who has become liable to be registered under this Schedule shall cease to be so liable at any time after being registered if the Commissioners are satisfied that the value of his taxable supplies in the period of one year then beginning will not exceed £88,000.

(2) A person shall not cease to be liable to be registered under this Schedule by virtue of sub-paragraph (1) above if the Commissioners are satisfied that the reason the value of his taxable supplies will not exceed £88,000 is that in the period in question he will cease making taxable supplies, or will suspend making them for a period of 30 days or more.

(3) In determining the value of a person’s supplies for the purposes of sub-paragraph (1) above, supplies of goods or services that are capital assets of the business in the course or furtherance of which they are supplied ... shall be disregarded.

(4) Where, apart from this sub-paragraph, an interest in, right over or licence to occupy any land would under sub-paragraph (3) above be disregarded for the purposes of sub-paragraph (1) above, it shall not be if it is supplied on a taxable supply which is not zero-rated.

Notification of liability and registration

5

(1) A person who becomes liable to be registered by virtue of paragraph 1(1)(a) above shall notify the Commissioners of the liability within 30 days of the end of the relevant month.

(2) The Commissioners shall register any such person (whether or not he so notifies them) with effect from the end of the month following the relevant month or from such earlier date as may be agreed between them and him.

(3) In this paragraph “the relevant month”, in relation to a person who becomes liable to be registered by virtue of paragraph 1(1)(a) above, means the month at the end of which he becomes liable to be so registered.

6

(1) A person who becomes liable to be registered by virtue of paragraph 1(1)(b) above shall notify the Commissioners of the liability before the end of the period by reference to which the liability arises.

(2) The Commissioners shall register any such person (whether or not he so notifies them) with effect from the beginning of the period by reference to which the liability arises.

7

(1) A person who becomes liable to be registered by virtue of paragraph 1(2) above shall notify the Commissioners of the liability within 30 days of the time when the business is transferred.

(2) The Commissioners shall register any such person (whether or not he so notifies them) with effect from the time when the business is transferred.

8

Where a person becomes liable to be registered by virtue of paragraph 1(1)(a) above and by virtue of paragraph 1(1)(b) or 1(2) above at the same time, the Commissioners shall register him in accordance with paragraph 6(2) or 7(2) above, as the case may be, rather than paragraph 5(2) above.

Entitlement to be registered

9

Where a person who is not liable to be registered under this Act and is not already so registered satisfies the Commissioners that he—

(a) makes taxable supplies; or

(b) is carrying on a business and intends to make such supplies in the course or furtherance of that business,

they shall, if he so requests, register him with effect from the day on which the request is made or from such earlier date as may be agreed between them and him.

10

(1) Where a person who is not liable to be registered under this Act and is not already so registered satisfies the Commissioners that he—

(a) makes supplies within sub-paragraph (2) below; or

(b) is carrying on a business and intends to make such supplies in the course or furtherance of that business,

and (in either case) is within sub-paragraph (3) below, they shall, if he so requests, register him with effect from the day on which the request is made or from such earlier date as may be agreed between them and him.

(2) A supply is within this sub-paragraph if—

(a) it is made outside the United Kingdom but would be a taxable supply if made in the United Kingdom; or

(b) it is specified for the purposes of subsection (2) of section 26 in an order made under paragraph (c) of that subsection.

(3) A person is within this sub-paragraph if—

(a) he has a business establishment in the United Kingdom or his usual place of residence is in the United Kingdom; and

(b) he does not make and does not intend to make taxable supplies.

(4) For the purposes of this paragraph—

(a) a person carrying on a business through a branch or agency in the United Kingdom shall be treated as having a business establishment in the United Kingdom, and

(b) “usual place of residence”, in relation to a body corporate, means the place where it is legally constituted.

Notification of end of liability or entitlement etc

11

A person registered under paragraph 5, 6 or 9 above who ceases to make or have the intention of making taxable supplies shall notify the Commissioners of that fact within 30 days of the day on which he does so unless he would, when he so ceases, be otherwise liable or entitled to be registered under this Act if his registration and any enactment preventing a person from being liable to be registered under different provisions at the same time were disregarded.

12

A person registered under paragraph 10 above who—

(a) ceases to make or have the intention of making supplies within sub-paragraph (2) of that paragraph; or

(b) makes or forms the intention of making taxable supplies,

shall notify the Commissioners of that fact within 30 days of the day on which he does so unless, in the case of a person ceasing as mentioned in sub-paragraph (a) above, he would, when he so ceases, be otherwise liable or entitled to be registered under this Act if his registration and any enactment preventing a person from being liable to be registered under different provisions at the same time were disregarded.

Cancellation of registration

13

(1) Subject to sub-paragraph (4) below, where a registered person satisfies the Commissioners that he is not liable to be registered under this Schedule, they shall, if he so requests, cancel his registration with effect from the day on which the request is made or from such later date as may be agreed between them and him.

(2) Subject to sub-paragraph (5) below, where the Commissioners are satisfied that a registered person has ceased to be registrable, they may cancel his registration with effect from the day on which he so ceased or from such later date as may be agreed between them and him.

(3) Where the Commissioners are satisfied that on the day on which a registered person was registered he was not registrable, they may cancel his registration with effect from that day.

(4) The Commissioners shall not under sub-paragraph (1) above cancel a person’s registration with effect from any time unless they are satisfied that it is not a time when that person would be subject to a requirement to be registered under this Act.

(5) The Commissioners shall not under sub-paragraph (2) above cancel a person’s registration with effect from any time unless they are satisfied that it is not a time when that person would be subject to a requirement, or entitled, to be registered under this Act.

(6) In determining for the purposes of sub-paragraph (4) or (5) above whether a person would be subject to a requirement, or entitled, to be registered at any time, so much of any provision of this Act as prevents a person from becoming liable or entitled to be registered when he is already registered or when he is so liable under any other provision shall be disregarded.

(7) In this paragraph, any reference to a registered person is a reference to a person who is registered under this Schedule.

(8) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Exemption from registration

14

(1) Notwithstanding the preceding provisions of this Schedule, where a person who makes or intends to make taxable supplies satisfies the Commissioners that any such supply is zero-rated or would be zero-rated if he were a taxable person, they may, if he so requests and they think fit, exempt him from registration under this Schedule until it appears to them that the request should no longer be acted upon or is withdrawn.

(2) Where there is a material change in the nature of the supplies made by a person exempted under this paragraph from registration under this Schedule, he shall notify the Commissioners of the change—

(a) within 30 days of the date on which it occurred; or

(b) if no particular day is identifiable as the day on which it occurred, within 30 days of the end of the quarter in which it occurred.

(3) Where there is a material alteration in any quarter in the proportion of taxable supplies of such a person that are zero-rated, he shall notify the Commissioners of the alteration within 30 days of the end of the quarter.

Power to vary specified sums by order

15

The Treasury may by order substitute for any of the sums for the time being specified in this Schedule such greater sums as they think fit.

Supplementary

16

The value of a supply of goods or services shall be determined for the purposes of this Schedule on the basis that no VAT is chargeable on the supply.

17

Any notification required under this Schedule shall be made in such form and manner and shall contain such particulars as may be specified in regulations or by the Commissioners in accordance with regulations.

18

In this Schedule “registrable” means liable or entitled to be registered under this Schedule.

19

References in this Schedule to supplies are references to supplies made in the course or furtherance of a business.

SCHEDULE 1A

Liability to be registered

1

(1) A person becomes liable to be registered under this Schedule at any time if conditions A to D are met.

(2) Condition A is that—

(a) the person makes taxable supplies, or

(b) there are reasonable grounds for believing that the person will make taxable supplies in the period of 30 days then beginning.

(3) Condition B is that those supplies (or any of them) are or will be made in the course or furtherance of a business carried on by the person.

(4) Condition C is that the person has no business establishment, or other fixed establishment, in the United Kingdom in relation to any business carried on by the person.

(5) Condition D is that the person is not registered under this Act.

2

(1) A person does not become liable to be registered by virtue of paragraph 1(2)(b) if the reason for believing that taxable supplies will be made in the 30-day period mentioned there is that a business, or part of a business, carried on by a taxable person is to be transferred to the person as a going concern in that period.

(2) But if the transfer takes place, the transferee becomes liable to be registered under this Schedule at the time of the transfer if conditions A to D in paragraph 1 are met in relation to the transferee at that time.

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Value Added Tax Act 1994

Settling appeals by agreement.

85

Payment of tax on determination of appeal

85A

Payment of tax where there is a further appeal

85B

Appeals to Court of Appeal.

86

Enforcement of registered or recorded tribunal decisions etc.

87

Part VI — Supplementary provisions

Change in rate of VAT etc. and disclosure of information

Supplies spanning change of rate etc.

88

Adjustments of contracts on changes in VAT.

89

Failure of resolution under Provisional Collection of Taxes Act 1968.

90

Disclosure of information for statistical purposes.

91

Interpretative provisions

Taxation under the laws of other member States etc.

92

Territories included in references to other member States etc.

93

Meaning of “business” etc.

94

Meaning of “new means of transport”.

95

Meaning of “online marketplace” and “operator” etc

95A

Other interpretative provisions.

96

Supplementary provisions

Orders, rules and regulations.

97

Place of supply orders: transitional provision.

97A

Service of notices.

98

Refund of VAT to Government of Northern Ireland.

99

Savings and transitional provisions, consequential amendments and repeals.

100

Commencement and extent.

101

Short title.

102

SCHEDULE A1

The supplies

1

Interpretation

2

3

4

5

6

Interpretation of paragraph 1(5)

7

Interpretation of paragraph 1(6): introductory

8

Interpretation of paragraph 1(6): meaning of “qualifying conversion”

9

Interpretation of paragraph 1(6): meaning of “changed number of dwellings conversion”

10

Interpretation of paragraph 1(6): meaning of “house in multiple occupation conversion”

11

Interpretation of paragraph 1(6): meaning of “special residential conversion”

12

Special residential conversions: reduced rate only for supplies made to intended user of converted accommodation

13

Interpretation of paragraph 1(6): “qualifying conversion” includes related garage works

14

Interpretation of paragraph 1(6): conversion not “qualifying” if planning consent and building control approval not obtained

15

Interpretation of paragraph 1(6): meaning of “supply of qualifying services”

16

Interpretation of paragraphs 11 to 14: meaning of “qualifying residential purpose”

17