This paragraph examines how VAT recovery applies to solicitors and a number of other practical points for the profession. The liability of supplies commonly made by solicitors is considered in V6.359.
Recovery of VAT—solicitors
Partial exemption
As outlined in V6.359, solicitors can occasionally receive income which is exempt from VAT. Exempt income may include commission for insurance and finance related intermediary services. Solicitors with exempt income need to consider the topic of partial exemption which is addressed in V3.460–V3.470 as VAT cannot normally be recovered where it is used for exempt activities. However, where the level of exempt income is very low (as it often will be) there may not be a restriction in VAT recovery for the solicitor if its input
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