Value Added Tax Act 1994 section 21

Refund of VAT on supplies of goods and services supplied to scheme participant

Section 21 deals with the power of HMRC to make regulations allowing VAT refunds to overseas businesses that participate in special accounting schemes.

• HMRC already has power under section 39 of the VAT Act 1994 to make regulations for repaying VAT to businesses based overseas.
• This section extends that power to cover VAT refunds to participants in special accounting schemes, as required by the EU VAT Directive.
• The refunds relate to VAT charged on goods and services supplied to scheme participants, and must be processed in accordance with EU Directive 2008/9/EC.
• The provision gives effect to Article 369j of the VAT Directive, which sets out the refund entitlement for participants in these schemes.