This part of GOV.UK is being rebuilt – find out what beta means

HMRC internal manual

VAT Partial Exemption Guidance

Legal history and glossary of terms: index of cases referred to


Abbey National - ECJ decision C 408/98

PE62500 - Transfers of a going concern (TOGC).

Transfers of Going Concerns and the treatment of associated input tax.

Barclays Bank Plc - Tribunal decision 5616

PE35500 - The special method document

Interpretation of PE special method approval letters.

BLP Group Plc - ECJ decision C 4/94

PE21500 - Attribution case law

PE73000 - Finance

The direct and immediate link required in order for costs to be cost components of specific supplies made.

BMW (GB) Ltd - Tribunal decision 14823

PE52000 - Directing special methods

The tribunals’ supervisory role and the steps the Commissioners can be expected to have taken.

Card Protection Plan - ECJ decision C 349/96

PE73000 - Finance

Single and multiple supplies.

C H Beazer (holdings) Plc - QB decision [1989] STC 549

PE61000 - Changes in intention or use.

When use has occurred.

Cooper & Chapman (Builders) Ltd - QB decision [1993] STC 1

PE61000 - Changes in intention or use

When use has occurred.

Curtis Henderson Ltd - QB decision [1992] STC 732

PE21500 - Attribution case law

PE61000 - Changes in intention or use

Change of use, full indention at the point of first use and acceptable attributions.

Deutsche Ruck UK Reinsurance Co Ltd - QB decision [1995] STC 495

PE74000 - Insurance companies’ partial exemption calculations

Direct and immediate links and cost components in the insurance sector.

Dial-a-Phone - CoA decision [2004] STC 987

PE21500 - Attribution case law

The right to deduct being acquired when the tax is incurred, and based on the intentions then, and not lost when the costs are subsequently wasted.

East Kent Medical Services Ltd - Tribunal decision 16095

PE72700 - The Capital Goods Scheme (CGS)

When “first use” occurs for a CGS item and its interaction with “use” generally.

Empresa da Desenvolvimento Mineiro SGPS SA (EDM) - ECJ decision C 77/01

PE30500 - Exclusions from the standard method and incidental supplies

The tests for incidental supplies, updated from Regie Dauphinoise.

Forexia (UK) Ltd - Tribunal decision 16041

PE73000 - Finance

Whether information sheet distribution in the finance sector is a supply of goods.

Ghent Coal Terminal NV - ECJ decision C 37/95

PE21500 - Attribution case law

The right to deduct being acquired when the tax is incurred, and based on the intentions then, and not lost when the costs are subsequently wasted.

Greenpeace Ltd - Tribunal decision 16681

PE37600 - What longer period adjustments cannot be used for

The interaction of capping and annual adjustments in what errors can be corrected.

James G Whitelaw - Tribunal decision 4299

PE33000 - Introduction to special methods

The scope of HMRC’s powers in approving methods and tribunals jurisdiction in reviewing this.

Kretztechnik - ECJ Case C 465/03

PE30500 - Incidental financial supplies

The issue of new shares is not a supply for VAT, and costs should be treated as being residual, and are recoverable according to the PE circumstances of the issuer.

Liverpool Institute for Performing Arts - HOL decision [2001] STC 891

PE34000 - Regulation 103: Recovery of input tax attributable to foreign and specified supplies

The scope of the standard method as only covering recovery of input tax in regards to taxable supplies made in the UK. What goes into the apportionment calculation in the standard method. The mechanism for recovering input tax in regards of other supplies carrying the right to deduct.

Merchant Navy Officers Pension Fund Trustees Ltd & Merchant Navy Ratings Pension Fund Trustees Ltd - Tribunal decision 14262

PE52000 - Directing special methods

That it is not acceptable to withdraw a special method without the method that will replace it being fair and reasonable.

Midland Bank Plc - ECJ decision C 98/98

PE21500 - Attribution case law

General overheads have a direct and immediate link to all businesses activities. Costs incurred as a result of making a supply rather than as a cost component do not have a direct and immediate link to that supply.

Pembridge Estates Ltd - Tribunal decision 9606

PE61000 - Changes in intention or use

That regulations 108 and 109 can only apply up to first use and changes thereafter are irrelevant, even if only days after.

R&R Pension Fund Trustees - QB decision STC [1996] 889

PE72700 - The Capital Goods Scheme (CGS)

That, where it applies, the CGS is the only correct way of adjusting input tax under the law.

Regie Dauphinoise - Cabinet A Forest SARL - ECJ decision C 306/94

PE30500 - The standard method

Royal & Sun Alliance - HoL decision STC [2003] 832

PE72000 - Partial exemption and land and property

Costs, such as rentals, incurred on a property while seeking to rent it exemptly and used up prior to the making of an option with a view to making taxable rentals, are unavailable for a payback claim.

Royal & Sun Alliance - Tribunal decision VTD 18842

PE34000 - Regulation 103: Recovery of input tax attributable to foreign and specified supplies

HMRC have power under their care & management to make agreements as to how use will be established for regulation 103, those agreements can be combined with special methods under regulation 102 and they may be outputs based.

Southern Primary Housing Association Ltd - CA decision [2003] STC 209

PE21500 - Attribution case law

The scope of direct and immediate link. That “but for” is no substitute for direct and immediate link.

The University of Sussex - Tribunal decision 16221

PE48000 - ‘Gaps’ in special methods

All residual input tax must be addressed by any PE method and gaps cannot exist. If costs are partly used in making taxable supplies some element of the associated input tax must be recoverable.

The University of Wales College Cardiff - QB decision [1995] STC 611

PE61000 - Changes in intention or use

What the initial attribution of input tax in the VAT period and longer period it was incurred in can be based on and the interaction with this article 20 of the directive.

UBAF Bank Ltd - CA decision [1996] STC 372

PE62500 - Transfers of a going concern (TOGC)

University Court of the University of Glasgow - Tribunal decision 17744

PE40000 - Requests for changes to special methods

To be fair and reasonable a method must be so overall and cherry picking certain sectors for a change is unacceptable.

Verbond van Nederlandse Ondernemingen - ECJ decision C 51/76

PE67000 - The Capital Goods Scheme (CGS)

What are the characteristics of capital goods?

Wellington Private Hospital Ltd - Tribunal decision 10627B

PE44500 - De facto approval

De facto approval of PE special methods.

Although not claiming to be exhaustive this section aims to provide definitions of many of the terms commonly used in PE. In the text other terms defined in this glossary appear in italics.