What is the definition of a student
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13th February 2014
Well… I am sure that your position differs
depending on whether you were or weren’t a student! however… casting
aside… HMRC have announced new guidance on the definition of the term
relation to the VAT reliefs available for buildings used for a
As you may be aware, there is a VAT relief
available for construction services in relation to new buildings that
for a relevant residential purpose; and in this case relevant
purpose includes student accommodation.
HMRC have stated that in some cases
taxpayers have misinterpreted the definition of ‘student’ and this has
that the relief has been incorrectly applied.
They have stated that the ambiguity often
arises in relation to summer schools, residential events and academic
HMRC have acknowledged that many people attend classes that
are badged as 'summer schools', and have stated
that if the subject matter falls into the category of hobbies or
interests (for example pottery workshops, art or literature
courses etc.) as opposed to receiving educational or vocational
training to an
academic standard, the attendees will not qualify as 'students'.
The guidance in this area is again
unnecessarily complex and in our view does appear to raise more
answers. It is difficult to apply many of the VAT reliefs already
having to over analyse who is and who isn’t a student.
We continue to recommend seeking
professional advice if you or your client is engaging in construction
projects. There are many VAT reliefs available and all have very
conditions that must be satisfied, given the significant values
the potential for irrecoverable VAT and penalties if errors are made,
it is of
the utmost importance to ensure that the rules are correctly applied.
For your information, Business Brief 03/14
announces the new guidance which is contained at VCONST15360.
About the Author
VAT People are leading VAT and Customs Duty
consultants based in the
North West of England. We work with a wide range of businesses
throughout the UK as well as assisting our accountancy colleagues to
unravel the thorny VAT issues for their clients. We are one of the UK's
largest and most comprehensive sources of VAT and Customs advice, our
consultancy team having over 140
years of experience in VAT and Customs
gained in either HMRC or a Big 4 accountancy practice environment.
Call us on our VAT helpline 0800 077 4604 to discuss. All initial discussions are free with no-obligation.
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Article Published/Sorted/Amended on Scopulus 2014-02-20 08:08:37 in Tax Articles