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Postal property searches concession to be withdrawn

15 June 2020
Issue: 4748 / Categories: News

The concessionary VAT treatment for property searches conducted by post is to be withdrawn from 1 December 2020. The concession allows solicitors and conveyancers to treat postal property search fees charged to their clients as ‘disbursements’ so they are not required to include them in the value of their supplies for VAT purposes. 

However, in Brabners LLP (TC6093) the First-tier Tribunal decided that electronic search fees were not disbursements. As a result, the concession produces a confusing difference in VAT treatment between postal search fees – which can be treated as a disbursement – and electronic search fees – which generally cannot. HMRC states that the withdrawal of the concession will remove this inconsistency and allay some of the confusion over whether costs can be treated as VAT disbursements. 

HMRC’s views are set out more generally in VAT Notice 700, para 25.1.


Issue: 4748 / Categories: News
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