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FA 2019: VAT on vouchers

FA 2019 Sch 17 creates a new VATA 1994 Sch 10B which provides for a new regime for the taxation of face value vouchers issued on or after 1 January 2019. It mirrors EU Council Directive (EU) 2016/1065 which came into effect on the same day and amends Directive 2006/112/EC (the Principal VAT Directive). The purpose of Directive 2016/1065 is to ensure that face value vouchers which are gaining in popularity throughout Europe are treated in the same way in all member states thus avoiding the possibility of non-taxation or double taxation. Although the UK will not be required to align with the Directive post-Brexit it seems unlikely that that there will be any divergence in treatment in the short term at least.

The term ‘face value voucher’ does not include discount vouchers tickets (for travel admission to events etc.) or postage...

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