The VATman striketh

What is the situation regarding those Steam centres that charge an admission fee but don't actually run a service between two or more recognisable places This follows on from the visitation for Quainton Road and the possible impact to others like Didcot and Telford.

 

I always thought vat was chargeable on such admissions.

 

Vat is payable on the admission price & the train ride, unless the visitor can get off the train at a place other than the departure point.

If a second place is available to detrain, the train ride element therefore becomes a journey which is then not vatable, but the Museum/Visitor Centre element is vatable.

 

the official guidance is contained in VAT notice 744A - which is available on WWW.hmrc.gov.uk.
see section 8.1 - "8.1 When must I charge VAT at the standard rate?
If you supply any of the following transport services, you must charge VAT at the standard-rate:
Where the supply of transport services includes the right of admission to fair-grounds, museums, stately homes, theme parks, safari parks, water parks, piers, zoos and other places of entertainment, historic or cultural interest. Your transport services are standard rated whether you charge an overall admission price, which includes transport, or make a separate charge for the transport."

 

Not quite always Steve - but since a rule change in late 1992 from memory!

Heritage railways were caught by a rule change regarding provision of public transport "within a place of entertainment". A number of theme parks, zoos and the like had been apportioning their admisison fees between the price of actually admission (Standard rated for VAT - or Exempt in some cases) and the provision of transport around the site (Zero rated as public transport). This saved them VAT or enabled the claiming of Input VAT on transport related costs. Not all of them did it - when this rule change highlighted the previosu position, at least one theme park put in a claim for the past 3 years for doing the apportionment!

For Railways, the basic test was set as can people join or leave the train at more than the starting point - or, perhaps more accurately, can they join or leave the railway's premises. Hence, I believe sites where there was a platform at the opposite end from the main public access, but no public access or ability to leave the area immediately round that platform and in Railway ownership, I believe VAT was still being applied. This did act as impetus to one or two extesnion projects to get the Railways in question to the position where public access was available at two separate points connected by the train service!

Whilst most heritage lines will be fine, there are also a few even of a few miles length who I expect will be caught and I would expect all "steam centres" to be caught, assuming, of course, that they have a Turnover in excess of the VAT Registration Limit.

Steven Hogg, FCCA
Principle
Hobarn & Co
Registered Auditors and Chartered Certified Accountants