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HMRC internal manual

VAT Government and Public Bodies

From
HM Revenue & Customs
Updated
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Government departments and health authorities: Contracted Out Services (COS) Headings: COS Heading 37 - Maintenance, repair and cleaning of equipment, plant, vehicles and vessels

This heading allows government departments and NHS bodies to recover VAT on:

  • Repair, maintenance and cleaning of equipment, plant, vehicles and vessels that they own, and/or
  • Repair, maintenance and cleaning of equipment, plant, vehicles and vessels that are leased. This is providing that the repair and maintenance work is supplied under a separate contract or agreement from the lease but it does not have to be made by a different supplier. Where the lease and maintenance are provided by the same supplier, the contracts/agreements must not be interdependent on each other and must be separately enforceable.

Additional information

  • For the purposes of COS recovery, the term vessels includes ships and aircrafts and the term equipment includes computer equipment
  • VAT incurred on the leasing or hire of equipment, plant, vehicles and vessels is not eligible for recovery. The only exceptions to this are Headings 25 ‘Hire of reprographic equipment including repair and maintenance’ and Heading 26 ‘Hire of vehicles, including repair and maintenance’. In both these cases, the VAT is only recoverable on contracts that provide for the supply of the equipment/vehicles together with full repair and maintenance services
  • Examples of what is included or excluded under Heading 37 can be found at VATGPB10435.