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HMRC internal manual

VAT Land and Property

Taxable person: managing agents for property: properties where the option to tax has been exercised

The supply to the tenant is by the landlord. If, in the case of an opted property, there are unpaid sums owing from a tenant, bad debt relief is only allowable to the landlord and not the agent (because the supply by the agent is to the landlord, not the tenant).

A failure to standard rate the recovery of the landlord’s insurance from the tenants is still a fairly common error in respect of opted properties (but note that in exceptional cases the tenant may be the policy holder).