½Û×ÓÊÓÆµ

Input tax ― business, non-business and private use

Produced by a Tolley Value Added Tax expert
Value Added Tax
Guidance

Input tax ― business, non-business and private use

Produced by a Tolley Value Added Tax expert
Value Added Tax
Guidance
imgtext

This guidance note looks at issues around whether expenditure is used for business, private or other non-business purposes in the context of VAT recovery and input tax.

For an overview of input tax more broadly, see the Input tax ― overview guidance note.

For in-depth commentary on the legislation and case law on input tax and business activities, see De Voil Indirect Tax Service V3.405A–V3.410.

Business, non-business and private use ― the basics

A general rule is that it is not possible to recover VAT on costs incurred on non-business activities. There are, however, a number of significant exceptions to this general rule that are summarised towards the end of this guidance note. Only VAT on costs which is used for business purposes can properly be said to be ‘input tax’. VAT which is incurred for either private or non-business purposes is not input tax and cannot be recovered, other than in exceptional circumstances.

HMRC policy regarding whether an activity is in the course or furtherance of a business has

Continue reading the full document
To gain access to additional expert tax guidance, workflow tools, and tax research, register for a free trial of Tolley+â„¢
Powered by

Popular Articles

Transfer of assets to beneficiaries ― legal, administration and tax issues

Transfer of assets to beneficiaries ― legal, administration and tax issuesThis guidance note outlines how assets are transferred to beneficiaries and the tax consequences that flow from the transfer. Whether a payment is income or capital is discussed in the Payments to trust beneficiaries guidance

14 Jul 2020 13:52 | Produced by Tolley Read more Read more

What are connected companies for loan relationship purposes ― practical approach

What are connected companies for loan relationship purposes ― practical approachBrief overview of the rulesThe loan relationships legislation applies to any ‘money debt’ arising from the lending of money entered into by a company, either as a lender or borrower. The rules are contained in CTA 2009,

20 Apr 2021 16:00 | Produced by Tolley Read more Read more

Temporary differences

Temporary differencesCalculation of temporary differencesThe temporary difference arising in respect of an asset or liability is calculated by comparing the carrying value of that asset or liability with its tax base.IAS 12 uses the concept of taxable or deductible temporary differences. Whether a

14 Jul 2020 13:49 | Produced by Tolley in association with Malcolm Greenbaum Read more Read more