For VAT purposes the term ‘a person’ refers to any individual or entity. A person is a taxable person if they are registered for VAT or if they are not registered for VAT but should be registered for VAT (see VATA 1994 s 3). This can have advantages and disadvantages.
For example a VAT-registered comedian who also generates exempt income from a residential letting activity is a partly exempt taxable person. An advantage is that the comedian should be able to recover exempt input tax in relation to the letting activity if it is de minimis. A disadvantage is the complexity of the partial exemption rules.
The effect of the de minimis rules is that a partly exempt taxable person can be treated as fully taxable if the total value of exempt input tax for the relevant period is not more than £625 a month...
Please reach out to customer services at +44 (0) 330 161 1234 or 'customer.services@lexisnexis.co.uk' for further assistance.