VAT Reform in Financial Services Working Group

Ensuring a modern and competitive regime for the financial sector and facilitating review as required

Industry challenge

The UK Government wishes to examine whether there is need for reform of the VAT regime as it applies to financial services in order to ensure a modern and competitive regime for the financial sector, while also ensuring stability of revenue. As announced at Budget 2020, Her Majesty’s Treasury (HMT) and Her Majesty’s Revenue and Customs (HMRC) are therefore establishing the ‘Financial Services VAT Working Group’ on the future of VAT Financial Services to look at the question of reform and make recommendations as to whether a review is needed.

The role of the Financial Services VAT Working Group is to produce recommendations to the UK government on whether to launch a wholesale review of the VAT treatment of financial services in the UK. Alternatively, it may produce recommendations on which areas would benefit from narrower reform. The Financial Services Working Group will examine the UK VAT and Insurance Premium Tax (IPT) treatment of all financial services and produce recommendations on whether there is a need for reform to simplify and improve competitiveness based on a broadly revenue neutral framework.

Group purpose

VAT Reform in Financial Services is made up of firms that manufacture, sell and service financial services products so has a deep understanding of how the industry works across the distribution lifecycle and how each stage is impacted by VAT.  Crucially representing the consumer and understanding how the indirect tax regime influences decision-making, and the impact that proposed changes to VAT law may have.  TISA is in a strong position to advise HMT, HMRC and their advisers on how proposed changes to VAT will affect the industry and consumer as well as warn of potential unintended consequences.  TISA is also in a strong position to monitor the effect of implemented new VAT regime and advise HMT and HMRC accordingly.

Participating member firms

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Bank of Ireland (UK) PLC
Barclays Wealth
CMS Cameron McKenna Nabarro Olswang LLP
Hargreaves Lansdown
Investec Bank Plc
Investec Wealth & Investment Limited
Killik & Co LLP
KPMG

LGT Wealth Management UK LLP
Lloyds Banking Group
RBC Brewin Dolphin
Salesforce
Sanlam Financial Services UK Ltd
St James’s Place Wealth Management
Target Group
Triplea Advisory Group

Lisa Laybourn, Head of Technical Policy and Regulation
leads on this work at TISA

Chair: Anna Burchner, CMS Cameron McKenna Nabarro Olswang LLP

If you are a TISA member, and would like to get involved with this work, please get in touch

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