Under the current VAT rules, government departments, devolved administrations, the NHS and Highways England are eligible for VAT refunds under Section 41 of the VAT Act 1994.
However, unlike commercial organisations, public sector organisations do not carry out business activities and therefore cannot reclaim VAT incurred on the goods and services they purchase.
The Treasury believes that VAT could act as a barrier to using more efficient and effective means of delivering a desired policy outcome. Section 41 was introduced to remove VAT from being a factor in decision making and enables the public sector to focus on making procurement choices that reflect true value for money for the Exchequer.
Source: jeffreycrawford.co.uk
Latest Posts in "United Kingdom"
- Upper Tribunal Rules Cosmetic Treatments by Medical Professionals Can Qualify for VAT Exemption
- High Court Rules Interest Payable on VAT in Contract Dispute Settlement
- FTT Grants Late VAT Appeal Despite Rejected Review Request Arguments
- Property TOGCs Under the Microscope: Navigating VAT Conditions and HMRC Expectations
- Fintua Sponsors Indirect Taxes Annual Conference 2025 in London (Nov 12)
