Potential VAT refund on Agency fees?

Following a recent decision in a VAT Tribunal case involving Reed Employment Limited, businesses should consider whether they are able to claim a refund of VAT which has been overcharged on the supply of temporary workers. This is particularly relevant to organisations unable to recover VAT on costs in full, e.g. those operating in the charity, education, healthcare and finance sectors. It is likely that in the first instance the agency that has charged VAT would need to submit a refund claim. It would then pass the overcharged VAT back to the customer.

If you require further information on this, please do not hesitate to contact one of our tax specialists.

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