A consultation to
examine how the European VAT cost sharing exemption might be used
by UK businesses and organisations was published today by HM
Revenue & Customs (HMRC). It will also explore a framework
for its possible implementation. This follows from the statement
in the March 2011 Budget that consultation would continue.
If implemented the exemption could remove the VAT charge
preventing institutions such as universities and charities from
gaining efficiencies by sharing costs with each other.
The consultation document can be found at: http://customs.hmrc.gov.uk/channelsPortalWebApp/channelsPortalWebApp.portal?_nfpb=true&_pageLabel=pageLibrary_ConsultationDocuments&propertyType=document&columns=1&id=HMCE_PROD1_031398
David Gauke, Exchequer Secretary to the Treasury, said:
“We’d like the views of a wide range of businesses and
organisations – particularly those in the education and charity
sectors – that have VAT exempt or non-business activities and want
to set up cost sharing arrangements. This is a complex relief
which could have far reaching impacts across a wide range of
sectors and careful consideration of the consultation results will
be required.”
1. The VAT Cost Sharing Exemption is a European law provision
that allows businesses and organisations making VAT exempt and/or
non business supplies to form groups to achieve cost savings and
economies of scale. Once formed the groups are relieved of a VAT
charge on their supplies if all the conditions of the exemption
are met.
2. The consultation will start on 28/06/11 and end on 30/09/11.
3. Postal address and email address to which written responses
can be submitted:
David Bond
HMRC
VAT Directorate Team
VAT
Projects
3C/10
100 Parliament Street
London SW1A 2BQ
Tel. 020 7147 0058
Email: david.bond2@hmrc.gsi.gov.uk
NAT 58/11
Issued by HM Revenue & Customs Press
Office
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