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Finance Act 2016

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Changes to legislation:

Finance Act 2016, Paragraph 5 is up to date with all changes known to be in force on or before 14 February 2025. There are changes that may be brought into force at a future date. Changes that have been made appear in the content and are referenced with annotations. Help about Changes to Legislation

5(1)In this Schedule “tax advantage”, in relation to VAT, is to be read in accordance with sub-paragraphs (2) to (4).U.K.

(2)A taxable person obtains a tax advantage if—

(a)in any prescribed accounting period, the amount by which the output tax accounted for by the person exceeds the input tax deducted by the person is less than it would otherwise be,

(b)the person obtains a VAT credit when the person would not otherwise do so, or obtains a larger VAT credit or obtains a VAT credit earlier than would otherwise be the case,

(c)in a case where the person recovers input tax as a recipient of a supply before the supplier accounts for the output tax, the period between the time when the input tax is recovered and the time when the output tax is accounted for is greater than would otherwise be the case, or

(d)in any prescribed accounting period, the amount of the person's non-deductible tax is less than it would otherwise be.

(3)A person who is not a taxable person obtains a tax advantage if the person's non-refundable tax is less than it otherwise would be.

(4)In sub-paragraph (3) “non-refundable tax”, in relation to a person who is not a taxable person, means—

(a)VAT on the supply to the person of any goods or services,

F1(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . and

(c)VAT paid or payable by the person on the importation of any goods F2...,

but excluding (in each case) any VAT in respect of which the person is entitled to a refund from the Commissioners by virtue of any provision of VATA 1994.

Textual Amendments

F1Sch. 18 para. 5(4)(b) omitted (31.12.2020) by Taxation (Cross-border Trade) Act 2018 (2018 c. 22), s. 57(3), Sch. 8 para. 121(a)(i) (with savings and transitional provisions in S.I. 2019/105 (as amended by S.I. 2020/1495, regs. 1(2), 21), S.I. 2020/1545, Pt. 4 and 2020 c. 26, Sch. 2 para. 7(7)-(9)); S.I. 2020/1642, reg. 4(b) (with reg. 7)

F2Words in Sch. 18 para. 5(4)(c) omitted (31.12.2020) by Taxation (Cross-border Trade) Act 2018 (2018 c. 22), s. 57(3), Sch. 8 para. 121(a)(ii) (with savings and transitional provisions in S.I. 2019/105 (as amended by S.I. 2020/1495, regs. 1(2), 21), S.I. 2020/1545, Pt. 4 and 2020 c. 26, Sch. 2 para. 7(7)-(9)); S.I. 2020/1642, reg. 4(b) (with reg. 7)

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