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HMRC internal manual

VAT Valuation Manual

Special valuation provisions: open market value on a sale by retail

The value imposed by a Notice of Direction issued under paragraph 2 of Schedule 6 is the open market value on a sale by retail. This is essentially the price paid by the final customer in the supply chain. In most cases a trader can take the recommended retail selling price (RRSP) or catalogue price of the goods to which the Notice applies as the appropriate value.

If the trader does not notify a RRSP to customers buying goods affected by the Notice, the value can be taken as the actual price at which the goods (or similar goods) are sold by retail by the trader’s customers or by similar retail outlets.

Remember: any discounts allowed to dealers, distributors or other intermediaries do not reduce the value at the retail level.