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HMRC internal manual

Debt Management and Banking Manual

Summary proceedings: VAT payments to bailiffs

VAT is payable on the service a bailiff provides if they are a ‘taxable person’.

A ‘taxable person’ is someone who carries on a business (or separate businesses) with an aggregate taxable turnover of more than a certain limit. They have to register with HM Revenue & Customs for VAT purposes, as a `taxable person’. This turnover amount has increased in successive Finance Acts so if you need to know the exact amount, contact your local VAT office.

If the bailiff or auctioneer is not a `taxable person’, no VAT is payable on their fees.

If you engage a bailiff to execute distress warrants, and VAT is payable but your court is not willing to pay VAT on the service provided, you will need to arrange payment locally.

The bailiff will charge VAT by invoice. You should agree with them

  • how often you will be invoiced. Monthly invoices should be sufficient in most offices
  • the amount of information you need to identify each case
  • details of the charge in each case in order to check the VAT calculation.

When you receive the bailiff’s VAT invoice

  • check each item to prevent fraud
  • check VAT calculation and that total charge is correct
  • pay through code W90 7399.

Accounting for VAT on SAFE

  • Record VAT on SAFE as a separate element of the costs charge.