V3.531 Margin schemes for goods—overview
This paragraph provides and overview of the VAT margin scheme for goods.
General principles of the margin scheme for goods
Output tax is normally calculated based on the value of the supply, subject to specific exclusions such as zero-rated and exempt supplies. Legislation (described below) provides for VAT chargeable on supplies of goods in certain categories to be based on the profit margin achieved by the taxable person.
This arrangement is beneficial (and generally only applicable) where the taxable person buys second-hand goods from private persons, and sells them to private persons, since it avoids the double taxation which would otherwise arise. This is because the tax paid on the purchase of the goods by the private person from whom the
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Web page updated on 17 Mar 2025 13:57