VAT on research between eligible bodies: the verdict

At the end of 2012 HMRC announced that from 1 August 2013 the VAT exemption for business research between ‘eligible bodies’ (central and local government, universities, non-profit charities and other public bodies) will be withdrawn.  Their consultation on the details has now finished, and HMRC have made two important concessions, on existing contracts and on collaborations among eligible bodies.  However there is a more fundamental and less clear-cut issue about which types of research will remain outside the scope of VAT (but see HMRC's further clarification below).  It’s likely that eligible bodies will need to take a view on a project-by-project basis.  These points are discussed in our briefing note, below.

Download the SRA Briefing Note icon_pdf16

Visit the HMRC website to download the Information Sheet

See the HRMC further clarification of research that is out of scope of VAT