Liability ― financial intermediaries and brokers

Produced by a Tolley Value Added Tax expert

Value Added Tax

Guidance

This guidance note covers the liability of the services of financial intermediaries and brokers.

For an overview of liability more broadly, see the VAT liability - overview guidance note.

For in-depth commentary on the legislation and case law on the liability of financial intermediaries and brokers, see De Voil Indirect Tax Service V4.136I.

Intermediary services ― the basics

The services of intermediaries who deal with financial services may be exempt from VAT but the strict conditions of exemption must be met. Where these conditions are not met, a financial intermediary’s supplies are typically standard-rated in the UK (although it is always prudent to consider whether any other VAT relief may apply).

The scope of the intermediary exemption is complex and is the subject of much of this guidance note. However, the essential elements are that:

•
the supply must be one of intermediary services
•
the supply must be in relation to certain financial services
•
the supplier must be acting in an intermediary capacity

In most (but not all) cases

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