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HMRC internal manual

Machine Games Duty

Operational: Compliance checks: cross-tax working

The aligned information and inspection powers provided by FA08/SCH36 and CEMA79 enable HMRC to coordinate and combine compliance checks into different taxes where this is the most efficient way to address risks. Although Machine Games Duty (MGD) is a duty of excise you may want to combine this with a compliance check on VAT because the exempt machine games takings may have an impact on the business’s deductible input tax. There will be an increase in newly partially exempt businesses which may lead to basic errors and misunderstandings. PE/VAT queries should be referred to VAT/PE specialists.

Guidance on carrying out a cross tax compliance check is in the Compliance Handbook 

VAT Notice 701/29 gives further guidance on VAT on site rentals, machine hire and machine purchase. VAT PE Notice 706 and Excise Information Note 03/12 give further guidance on partial exemption and the impact of MGD on the VAT status of businesses.

(This content has been withheld because of exemptions in the Freedom of Information Act 2000)