beta This part of GOV.UK is being rebuilt – find out what beta means

HMRC internal manual

VAT Fraud

What to consider prior to determining whether to use an intervention: applying VAT basics: was there a supply for VAT purposes?

As set out in VATSC03100 a transaction is within the scope of UK VAT if the following four conditions are met:

  1. it is a supply of goods or services;
  2. it takes place in the UK;
  3. it is made by a taxable person (someone who is, or is required to be registered) ; and
  4. it is made in the course or furtherance of any business carried on or to be carried on by that person.

To decide whether a transaction is within the scope of UK VAT, you should be satisfied that it meets all the above conditions. When a transaction does not meet all of the conditions it is outside the scope of VAT.

It is essential that you confirm that a transaction falls within the scope of VAT before moving to second-level questions looking at mechanics (for example time of supply, input tax etc) or liability.