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HMRC internal manual

VAT Government and Public Bodies

Police authorities: specific activities: staff and subsistence expenses

Police officers and civilian support staff frequently use a petty cash system to buy minor items to carry out their work. In many forces the volume and value of the claims may be large and the supporting evidence scant. Increasingly purchases may be made using a corporate purchasing card with card statements being unhelpful in determining whether VAT was incurred and whether it is recoverable.

Nevertheless it has to be accepted that there is recoverable VAT and it is necessary to establish a basis of recovery that avoids an unreasonable administrative burden on the police or difficulties for HMRC in verifying a claim.

A request to recover VAT as a flat percentage of gross expenditure may be considered based on testing samples of expenditure and available documentation. Expenditure that includes recoverable VAT is likely to be low, perhaps only 1% of gross payments.