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

HMRC internal manual

VAT Supply and Consideration

Consideration: Payments that are not Consideration: Grants: Related guidance

The consideration for a supply is everything received in return for the supply, including subsidies directly linked to the price. If there is no consideration there is no supply. 

The guidance on the definition of consideration in VATSC30000 must also be taken into account and you may wish to familiarise yourself with this before considering the indicators in this part of the guidance. 

Assistance in deciding whether there is a direct link between a supply and consideration can be found in the ECJ judgment in Mr Tolsma (C-16/93), see  VATSC50400.  You may also encounter issues around sponsorship and whether a payment is consideration for a supply.  The specific guidance on how to approach this subject is in VATSC09000.

Sometimes funding for activities that are carried out by a public body under statutory powers comes from a mixture of grants and statutory contributions by private individuals or businesses.  Guidance about how to approach this subject can be found VATGPB3500.