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HMRC internal manual

VAT Government and Public Bodies

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HM Revenue & Customs
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Other local authority activities: miscellaneous (A to E): election and returning officer’s expenses

Section 35(1) of the Representation of the People Act 1983, requires that

‘every district/county council shall appoint an officer of the council to be the returning officer for elections of councillors to the district/county.’

This remains the case even though the 1983 Act was generally updated by the Representation of the People Act 2000.

Because this places the local authority under a statutory obligation to provide the returning officer, it can recover any VAT it incurs in connection with local elections under section 33 (see VATGPB4000).

Council officers frequently act as returning officers in Parliamentary and European elections. Under the 1983 Act

‘The office of a returning officer is a distinct office from that by virtue of which he becomes a returning officer.’

In other words for general elections, by-elections or European elections, local authority returning officers (often the authority’s chief executive) are not acting as an officer of the council but in a capacity that is entirely separate from the local authority.

Nonetheless the Department for Communities and Local Government (DCLG) makes a payment to the local authority to compensate for one of their staff being diverted from their local authority duties. Because local authorities have to provide a returning officer by law the payment is not subject to VAT.

Likewise where local authorities are required by law to provide polling places, for example in a school hall, any reimbursement by the DCLG is not subject to VAT. Similar treatment applies to any other services provided under a statutory requirement. However, the transport of ballot boxes is not undertaken under any statutory obligation and so is standard rated.

Where local authorities have to provide certain facilities by law any VAT incurred on their provision is recoverable under section 33. But this does not apply where the returning officer has received goods or services from sources other than the local authority. Any VAT incurred is not recoverable by the local authority and so should be included in any reimbursement from the DCLG.

The DCLG will also provide funding for the purchase of election equipment such as polling booth screens and ballot boxes. Often these will be bought for the returning officer by the local authority. If the items will also be used in a local election, as well as other elections, then the local authority can recover the VAT in full. Due to their obligations to facilitate elections, the authority should not charge the returning officer for use of these items in other elections.

If items are bought exclusively for general or European elections, then a local authority can only recover VAT to the extent that it recharges it to the returning officer as buying agent. The VAT recharged to the returning officer should form part of their funding from the DCLG.