Supply and consideration ― agents, agency and principals

Produced by a Tolley Value Added Tax expert

Value Added Tax

Guidance

This guidance note examines the topic of agents (agency) and principals for VAT purposes.

For an overview of supply and consideration generally, see the Supply and consideration ― overview guidance note.

For in depth commentary on the legislation and case law in this area, see De Voil Indirect Tax Service V3.221.

Meaning of agent and principal

Neither the term agent nor the term principal is defined in the VAT legislation. However, HMRC will broadly use the term agent to describe a person who acts for or acts for someone else with the consent of both parties. That ‘someone else’ is the principal. An agent arranges supplies of goods or services by, or to, its principal.

It is worth noting that a person who describes themselves as an agent may nonetheless be acting as a principal within the VAT meaning of the term.

According to HMRC, to act as an agent, a business must have agreed with its principal to act on their behalf in relation to the particular transaction

Access this article and thousands of others like it
free for 7 days with a trial of Tolley+™ Guidance.

TAKE A FREE TRIAL

Popular Articles

Employment Tax

Short-term business visitors (STBVs)

Short-term business visitors (STBVs)What is a short-term business visitor?An STBV for UK tax purposes is an individual who performs duties for a non-UK employer and as a part of those duties has been asked to spend a short period working in the UK. There is a common misconception that there is

14 Jul 2020 13:40 | Produced by Tolley in association with Gill Salmons Read more

Employment Tax

Payroll record keeping

Payroll record keepingUnder SI 2003/2682, reg 97, “...an employer must keep, for not less than 3 years after the end of the tax year to which they relate, all PAYE records which are not required to be sent to [HMRC]...”. Reasons for keeping the records include:•being able to calculate tax and

14 Jul 2020 12:52 | Produced by Tolley in association with Vince Ashall Read more

Corporation Tax

Computation of corporation tax

Computation of corporation taxCompanies pay corporation tax on the taxable total profits (TTP) generated in a chargeable accounting period (CAP).To ascertain whether the entity is within the charge to corporation tax, see the Charge to corporation tax guidance note.For more information on the type

14 Jul 2020 11:16 | Produced by Tolley Read more

��˾��ҹ��