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HMRC internal manual

VAT Input Tax

HM Revenue & Customs
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VAT Input Tax basics: self employed labourers and contractors

A self employed labourer or contractor may buy tools or materials to use for a specific job. You may accept that the VAT incurred is input tax of the business that hired the labourer or contractor provided:

  • all the conditions at VIT13400 are satisfied;

and additionally:

  • in the case of tools, they become the property of the business;
  • in the case of materials, they are incorporated into and become a cost component of the supply by the business to the end customer.