Value Added Tax Act 1994 Schedule 10B paragraphs 6–8

Multi-purpose vouchers: special rules

Section 10B paragraphs 6–8 define what a multi-purpose voucher is and set out how VAT applies when such vouchers are issued, transferred, and ultimately redeemed for goods or services.

• A multi-purpose voucher is any voucher that does not qualify as a single purpose voucher — in other words, where the VAT treatment of the underlying supply cannot be determined at the point the voucher is issued.
• No VAT is charged when a multi-purpose voucher is issued or subsequently transferred; any payment made at those stages is disregarded for VAT purposes and does not count as a taxable supply for input tax recovery under section 26(2).
• VAT is instead charged at the point of redemption, when the voucher is accepted as payment for goods or services — the provision of those goods or services is treated as a taxable supply at that stage.
• The value of the supply on redemption is the VAT-inclusive amount equal to the price last paid for the voucher (if known to the supplier), or, if that price is not known, the face value stated on the voucher or in its terms and conditions.