VAT crisis for Stalls, Car Boots, Serviced Offices and Markets

Crafts- Market /Craft fair with stall holder

Until now the hire of stalls and other pitches used for temporary sales events have generally been considered to be the supply of land and exempt from VAT in accordance with Item 1, Group 1, Scedule 9 VAT Act 1994 and http://www.hmrc.gov.uk/vat/managing/reclaiming/partial-exemption.htm

But following discussions at EU level in connection with antiques fairs HMRC now feel that VAT should be chargeable at Standard Rate.

Not only that HMRC want VAT to be payable on add-on services such as promoting the fair, providing power and security which had been treated as incidental and VAT exempt.

The change in policy (according to http://www.tipsandadvice-vat.co.uk) came about following a VAT inspection and the decision is now being appealed.

Whilst the case applies to antiques if HMRC win it will be applied to:

  • Car Boot Sales
  • Services Office Accomodation
  • Market Stalls

This could have a massive effect on small traders who are not VAT registered.

steve@bicknells.net

 

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