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HMRC internal manual

VAT Government and Public Bodies

Police authorities: specific activities: special services

Section 25 of the Police Act 1996 permits a chief police officer to provide, if requested by the owner of premises or the organiser of an event, special services at those premises and events in the police area, and to charge for these services. Where this happens the services are provided under a special legal regime, but the question is whether they are none-the-less provided in competition with the private sector – in which case they are within the scope of VAT.

There are situations where it is accepted that only a police officer can provide the requisite service and thus it is not possible for the owner of the premises or the organiser of the event to use a private sector alternative. These fall into three broad categories: 

  1. Where only the police can perform the task.
  2. Where the recipient of the service has no option but to use police officers, because the Chief Constable stipulates this condition (so private security firms cannot compete).
  3. Where the recipient of the service cannot comply with its legal or other obligation without using police officers (so in theory they could hire private security guards, but this would be insufficient to comply with a legal requirement).

In these circumstances, the activity is outside the scope of VAT.

However, in other situations where the owner of the premises or the organiser of the event has an option either to use the services of police officers or to use the services of – for example – stewards or private security guards, then the supply by the police is within the scope of VAT (and normally it will be standard rated).

Here are some examples of services supplied by the police, either under section 25 or otherwise, and their VAT treatment. 

Sporting Events, Concerts and other Staged-Events

Where the chief police officer has determined the number of police officers necessary to police inside and outside the venue of an event, then the supply of these officers is outside the scope of VAT because the requirement to have them is imposed by the police.

Where the chief officer has not stipulated that a police presence is necessary, then if police officers are requested by the organiser the supply of them is standard rated.

It is, of course, possible for there to be a mixture of the two – for example, the chief officer imposes a requirement for police presence outside the venue but not inside it.

Shopping Centres

Where police officers are carrying out routine policing duties which can only be undertaken by them, this is a non-business activity and it is therefore outside the scope of VAT. Of course where police officers undertake the range of duties carried on by private security guards, this would be a business activity – but HMRC isn’t aware of any such examples.

Bank Security Services 

Where the police officers simply escort money or documents when they are being moved from premises to premises, the service is one that could be undertaken by private security firms and thus the police are in competition with these bodies. For this reason it is a business activity which is liable to VAT at the standard rate.

Airport Security

 Initially the Secretary of State could direct that the police can enter and patrol airport premises. Whether or not this is the case, police officers are present on airport premises in a law enforcement capacity performing duties that only they can undertake. The supply of police officers for this purpose is therefore outside the scope of VAT.

Firearms Training

The Manual of Guidance for the Police Use of Firearms and the National Police Firearms Training Curriculum (NPFTC) applies national standards to all UK firearms officers and only the police can train their own staff. There may be some competition between different forces to attract trainees, but all training must be provided by the police and no one else has the power to train officers to the standard required by law. It is not undertaken in competition with the private sector.

Training police officers in the use of firearms is therefore a non-business activity by the police which is outside the scope of VAT. 

Marches

The organisers of a march can request that police officers attend as stewards, but when they do so they are not acting in the capacity of police officers as such. The supply of police officers for this purpose is a business activity which is standard rated. Of course where the police attend marches for public order and law enforcement purposes, they will be performing duties that only a police officer can undertake and this is outside the scope of VAT.