Guidance

Buying and selling horses and ponies using the VAT margin scheme

How to use the margin scheme when buying and selling horses and ponies.

• From: HM Revenue & Customs
• Published: 23 December 2021
• Last updated: 2 November 2026
  Show all updates

  1. 2 November 2026

     Guidance from withdrawn VAT notice, The Margin and Global Accounting Scheme (VAT Notice 718), has been added.

  2. 23 December 2021

     First published.

There is additional information you need to record if you sell second-hand horses and ponies using a margin scheme.

There is also the British Equestrian Trade Association (BETA) form you can use instead of keeping a stock book and invoices.

When you can use a margin scheme

Horses and ponies must be second-hand to be eligible for a margin scheme.

A second-hand horse or pony is one that has previously been owned by somebody else.

When you cannot use a margin scheme

You cannot use a margin scheme if:

• you bred the horse yourself and are selling it for the first time, as it is not classed as second-hand
• VAT is shown separately on the purchase invoice for a horse or pony you have bought

Ways to account for VAT

There are 2 ways you can account for VAT. You must either:

• keep normal margin scheme records including the specific information set out in the section titled ‘If you use normal margin records’
• use the BETA form — then you do not need to keep a separate stock book or invoices

If you use normal margin scheme records

You must add extra information to your records.

If the purchase price of the horse or pony is more than £500, you must either:

• record the unique identifying passport number
• ask a vet to certify that the horse or pony is the one described on the invoice

You must also add:

• colour
• sex
• type or breed, for example, cob or thoroughbred
• age, if known
• height
• stable name, if known
• distinctive markings

How to work out the margin and VAT due

You should calculate the margin and VAT due using the normal margin scheme rules.

Records to keep

If you do not use the BETA form

If you do not use the British Equestrian Trading Association form then you should keep normal VAT margin scheme records.

If you buy and sell at auction and do not use the BETA form

You should keep the normal margin scheme records. You must include enough information in your stock book to identify the horse or pony, as mentioned above. 

There are specific rules that apply for auctioneers — read Using the auctioneers VAT margin scheme.

If you use the BETA form

The British Equestrian Trading Association form contains all the stock and sales records you need for the margin scheme. If you use this, then you do not need to keep a stock book or invoices.

Further information

You must show any goods you buy or sell using a margin scheme on your VAT return.

If you use an agent

You should refer to the specific rules for VAT margin schemes that apply for agents.

Tertiary legislation

You can find the legal conditions in VAT Tertiary Legislation:

• Section 2.4 — additional information requirements for horses and ponies
• Section 2.5 — BETA scheme for horses and ponies