Local authorities, government and public bodies ― overview

Produced by a Tolley Value Added Tax expert

Value Added Tax

Guidance

This guidance note provides an overview of the VAT treatment of supplies made to and from government and other public bodies. This note should be read in conjunction with the Local authorities and other public bodies ― recovering input tax guidance note.

For more in depth commentary, see De Voil Indirect Tax Service V2.108, V2.231 and HMRC’s internal guidance VATGPB1000 (VAT Government and Public Bodies).

What are public bodies?

HMRC states that it considers that the term ‘public body’ should take its normal everyday meaning and includes government departments, non-governmental public bodies, the NHS, local government bodies, and the police and fire and rescue services.

Following the High Court judgment in Riverside Housing Association Ltd v HMRC, HMRC has stated that the term ‘body governed by public law’ has a narrow application, in that a body only satisfies that criterion if it is a public body forming part of the UK’s public administration, such as a government department, a local authority or a non-departmental public body.

What non-business

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