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VAT Information Sheet 3/99, March 1999

This Information Sheet gives guidance on the VAT treatment of the various services supplied in connection with the Government's New Deal scheme to help the unemployed.

1 Introduction

New Deal is a programme designed to help young people aged 18–24 who have been unemployed for six months or more to obtain long term employment by providing opportunities for education, vocational training and work experience. The intention is to encourage employers to recruit these people, in return for which they are paid a subsidy. The unemployed are given opportunities to study towards accredited qualifications whilst continuing to claim an allowance equivalent to Jobseekers' Allowance.

Although aimed primarily at the 18–24 age group, there is provision for the over 25s as well (see section 5).

2 Components of New Deal

2.1 Gateway

For 18–24 year olds the package is made up of three components. The first of these, entitled Gateway, offers an intensive period of counselling, advice and guidance. This includes extensive help from the Employment Service (ES), covering,