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HMRC internal manual

VAT Taxable Person Manual

Particular trades: agricultural co-operatives

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Agricultural co-operatives are usually agents selling agricultural produce for individual growers or farmers, but it can often appear that there is a supply of goods by the farmer to the co-operative and then a supply of goods by the co operative to the customer. Under the provisions of the Industrial and Provident Societies Act 1965, however, the co-operatives must be the agents of the producers and the agreement between the farmer and the co-operative should contain a clause to this effect.

As an agent, the agricultural co-operative should normally be accounting for VAT on the consideration for its own supply of services to its members - commission, haulage, storage and packing charges.