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HMRC internal manual

VAT Taxable Person Manual

From
HM Revenue & Customs
Updated
, see all updates

Issues to consider: agency and disbursements: what is an agent?

We use the term ‘agent’ to describe a person who acts for or represents someone else (the ‘principal’) with the consent of both parties. An agent arranges supplies of goods or services between the principal and a third party by:

  • obtaining goods or services for the principal (ie as a buying agent), or
  • finding customers for the principal to sell to (ie as a selling agent).

Agents are always involved with two supplies at any one time:

  • the supply between their principal and the third party, and
  • the supply of their own services (services of agency) to their principal, for which a fee or commission is usually charged.