Magazine article Public Finance

Ruling Allows Public Bodies to Recoup VAT

Magazine article Public Finance

Ruling Allows Public Bodies to Recoup VAT

Article excerpt

Public bodies, such as NHS trusts and colleges, are now eligible to defer payment of millions of pounds in VAT, following a European Court of Justice ruling.

The concession relates to the VAT paid to Revenue & Customs on buildings used for both business - such as hospital wards used for private patients or commercially run kitchens - and non-business use.

For most public bodies, the majority of capital expenditure relates to non-business use primary functions such as medical care or education - and so is taxed at 17.5% on the day of purchase. VAT on assets for commercial use can be recouped.

The new ruling means that bodies can apply to R&C to have most of the VAT returned at once, and spread the payments that relate to non-business use over the life of the asset.

James Burberry, partner at PricewaterhouseCoopers Scotland, told Public Finance: 'What this ruling means is that you can claim more of the VAT back on day one. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.