If your business has followed the common practice of giving trade samples, your VAT returns will have been prepared on the basis that a single sample could be supplied to a person as a VAT-free supply but where a larger number of samples was given, output tax was payable.
Recently, HM Revenue and Customs have accepted that a decision of the European Court of Justice means that all trade samples supplied are VAT-free. Accordingly, where output tax has been paid on samples supplied, the VAT paid is recoverable subject to the usual time restrictions.
Full details are contained in HMRC Brief 51/10.
It should be noted that the treatment applies only to trade samples, not to trade gifts, which continue to be taxable.
Click here for guidance on VAT and the place of supply.
Click here for guidance on VAT on business assets with an element of private use.
01634 811118
Trade Samples - VAT Treatment Change
The contents of this article are intended for general information purposes only and shall not be deemed to be, or constitute legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article.
Ask a free legal question
Complete this simple form if you
would like to ask us a
free legal question
What Our Clients Say
We would like to thank you for the superb work and attention to detail that has gone into our dispute with the council so far!
Our Architect put together a very professional document which was further enhanced and polished by your very professional input.
You are in fact unique in my personal experience of the legal profession in that you take your duty of care very seriously. It is obvious that the outcome concerns you greatly and your determination to win is much appreciated!
Thank you from us both.
Best Regards
Mr and Mrs X, Surrey