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HMRC internal manual

VAT Government and Public Bodies

Police authorities: specific activities: escort and transport of prisoners

At one time the movement of prisoners was an activity only carried out by either the prison service or the police. The supply was non-business.

Where there is still a legal requirement for the police, or other similar public body, to carry out prisoner escort duties the service remains non-business. Over the years, however, there has been an increasing trend for escort services to be put out to tender. As a result there is competition with the private sector and so this is now a business activity.

Where the supply is by way of business, the liability depends on whether what is being supplied is the transport of passengers or an escort service. It may be necessary to examine contracts in order to confirm the position.

Where police are contracted to transport passengers, that is to say provide both the transport, driver and possibly an escort, then the liability will fall within Item 4, Group 8 of Schedule 8 to the VAT Act 1994. In that case the supply is:

  • zero-rated when provided in a vehicle designed or adapted to carry not less than twelve passengers, or
  • standard-rated in all other cases.

If the contract is limited to the provision of an escort the service, with the transport and driver being provided by somebody else, then the supply by the police is not transport. It is therefore standard-rated.