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HMRC internal manual

VAT Time of supply

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HM Revenue & Customs
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Tax points for specific categories of supplier: solicitors: non-contracting legal aid work

Other legal aid work (that is to say work not covered by the contracting arrangements described at VATTOS8560) is billed to the Legal Services Commission in the normal way. However, most bills are amended in some way. They will invariably be adjusted, either as a result of taxation or by the Legal Aid authorities themselves. Although the solicitor’s services are paid for through the Legal Aid arrangements, they are supplied to the client named in the Legal Aid Order. This means that any action by the solicitor in connection with submitting and agreeing the amount of the bill does not form part of the supply to the client. Again the basic tax point occurs when all the work, except the invoicing, has been completed. Apart from the centrally negotiated extension to the 14 day rule (see VATTOS5245) there are no special tax point rules that apply in these circumstances. Therefore tax must be accounted for on the basis of the normal tax point rules and adjusted later in the event of any subsequent reduction in the fee.