Sector summary ― financial services

Produced by Tolley in association with

Value Added Tax

Guidance

Introduction to the sector

The financial services sector covers a wide range of business activities. This segment of the economy is made up of a variety of financial institutions including banks, investment houses, lenders, finance companies, financial advisors and insurance companies. Large businesses dominate this sector, but it also includes a diverse range of smaller entities.

This guidance note covers the key VAT areas to consider for the financial services sector. It provides a starting point for advisers preparing for a meeting with clients which operate in this sector.

Relevant legislation

The exemption applicable to the financial services sector is VATA 1994, Sch 9, Group 5:

Item number	Description	Further detail
Item 1	The issue, transfer or receipt of, or any dealing with, money, any security for money or any note or order for the payment of money	De Voil Indirect Tax Service V4.136A
Item 2	The making of any advance or the granting of any credit	De Voil Indirect Tax Service V4.136B
Item 2A	The management

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