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The UK’s VAT exemption for business supplies of research between eligible bodies has been withdrawn with effect from 1 August 2013.
The move follows notification from the European Commission that the exemption (VATA 1994, sch 9 group 6) does not comply with European legislation. HMRC have published Revenue and Business Brief 21/13 to provide full details.
The UK’s VAT exemption for business supplies of research between eligible bodies has been withdrawn with effect from 1 August 2013.
The move follows notification from the European Commission that the exemption (VATA 1994, sch 9 group 6) does not comply with European legislation. HMRC have published Revenue and Business Brief 21/13 to provide full details.
The withdrawal applies to all written contracts entered into on or after 1 August 2013 – although contracts entered into before the date remain exempt for the term of the contract.
If the contract is extended or varied and the consideration payable is increased after 1 August, payments for new or changed supplies will be standard rated, but supplies relating to the contract as it stood at 31 July will remain exempt.
Supplies of research outside the scope of VAT are not affected by the measure.
