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HMRC internal manual

VAT Government and Public Bodies

HM Revenue & Customs
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Section 33 bodies: capital projects and other adjustments: capital goods

The capital goods scheme does not apply to items used solely for non-business purposes. This is because regulations 112 to 116 of the VAT Regulations 1995 refer to items being used for business purposes, rather than a mixture of business and non-business.

Nevertheless, it remains the case that capital items are used over a period of time. Consequently it is necessary to make provision for a change of intention on the part of a section 33 body.