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HMRC internal manual

VAT Government and Public Bodies

Section 33 bodies: local authorities: definition


There can be uncertainty over the eligibility of local authorities under section 33(3)(a) (see VATGPB4120). This can occur where bodies, although not themselves local authorities for the purposes of 33(3), have either

• close associations with local authorities

• receive funding from them, or

• local authority members on their boards.

A local authority is defined by section 96(4) of the VAT Act 1994 as follows.

(4) In this Act “local authority” means the council of a county, district, London borough, parish or group of parishes (or, in Wales, community or group of communities), the Common Council of the City of London, the Council of the Isles of Scilly, and any joint committee or joint board established by two or more of the foregoing and, in relation to Scotland, a regional, islands or district council within the meaning of the Local Government (Scotland) Act 1973, any combination and any joint committee or joint board established by two or more of the foregoing and any joint board to which section 226 of that Act applies.

Usually there should be no difficulty in identifying county, district, London borough or parish councils and the like. They will have the power to levy a precept on the Council tax and be financed directly from it. Difficulties can occur where committees or sub committees are involved which are not necessarily covered by 33(3). It is important therefore to examine the basis on which they have been established.

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Committees and joint committees

Committees and joint committees are established under sections 101 and 102(1) of the Local Government Act 1972 (LGA). This permits local authorities to discharge their functions through committees.

Only committees that discharge a local authority function may be treated as a local authority and must:

  • be established by one, or more, local authority under section 102(1) or be preserved under section 101(9) of the LGA, or
  • be a sub-committee of an eligible committee, and
  • have voting rights restricted to local authority members, unless regulations 4 or 5 of The Local Government (Committees and Political Groups) Regulations 1990 (see VATGPB4240) apply.

These committees deal with subjects as diverse as:

  • burials and cremations
  • fishing
  • superannuation
  • land management (other than local authority housing)
  • promotion of tourism
  • management of festivals.

Other committees may be responsible for the day-to-day management of community centres, youth clubs, sports halls and other establishments in which the local authority has an interest.

Health and wellbeing boards

The Health and Social Care Act 2012 requires local authorities to establish a Health and Wellbeing Board in its area from 1 April 2013.

Health and Wellbeing Boards bring together local authorities and others and will have strategic influence over commissioning decisions across public health and social care.

Section 194 (11) of the Health and Social Care Act 2012 deems a Health and Wellbeing Board to be treated as if it were a committee appointed under s102 LGA 1972 and so they are entitled to refunds of VAT under section 33.