VAT treatment of parking facilities

Produced in partnership with Martin Scammell

Practice notes

VAT treatment of parking facilities

Produced in partnership with Martin Scammell

Practice notes

This Practice Note is about the VAT treatment of parking facilities.

This Practice Note contains references to EU legislation and case law. For information on the ongoing significance of EU law in the UK following the end of the Brexit implementation period on 31 December 2020, see Practice Note: Retained EU law and tax. Unless otherwise stated, all judgments of the EU Court of Justice referred to in this Practice Note were decided before the end of the Brexit implementation period.

Why does this matter?

Charges for parking are normally subject to VAT, but this extends to leases and licences of entire car parks or blocks of garages, so that the sums involved may be substantial, and so that VAT needs to be recognised in sale and lease agreements. VAT can also sometimes be payable where parking is provided in conjunction with other accommodation, including residential property, and so the points are relevant in connection with plot sales.

If the seller or landlord has opted to tax, the transaction will normally be standard-rated anyway, but the taxation of parking

Martin Scammell

Martin Scammell is an independent VAT consultant, specialising in property and construction matters, who works with tax departments in major corporates and universities, and with a number of law and accountancy firms. He is the author of the leading reference work on VAT and property.

Martin started out in VAT Policy in Customs & Excise, was a Partner at Ernst & Young, where he headed up the VAT real estate group, and then became head of indirect tax at Eversheds.

He has been involved in the development of VAT legislation and policy over many years, and regularly serves on working parties established by HMRC. He was a member of the Office of Tax Simplification’s consultative committee for their review of VAT in 2017, and in 2018-19 of HMRC’s external stakeholder group considering the proposed reverse charge for building work. Martin currently works with HMRC as technical secretary to the British Property Federation’s VAT Committee, as an adviser to the British Universities’ Finance Directors’ Group and as a member of HMRC’s Joint VAT Consultative Committee and VAT Land and Property Liaison Group. He is a member of the Chartered Institution of Taxation’s indirect taxes and property taxes committees.

Jurisdiction(s):

United Kingdom

Key definition:

VAT definition

What does VAT mean?

Value Added Tax (VAT) is a tax charged on most goods and services when a VAT-registered business sells to either another business or to a non-business customer.

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