VAT & Partial Exemption – Ability to adjust for Covid Impact

Partial Exemption

Xeinadin Group



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If your business operates Partial Exemption Methods and was impacted by COVID-19, in March last year HMRC announced in RCB 4/21 “an accelerated process for VAT registered businesses to request temporary alterations to their partial exemption methods (including combined methods) to reflect changes to their business practices because of the coronavirus (COVID-19) pandemic.”

If your income levels and partial exemption recovery percentage have been affected by Covid then there is scope to review your calculations from 2020 onwards and submit a claim to HMRC based on an alternative method. 

It is worth noting that requests can include the current year if there is an ongoing impact from Covid in your organisation, for example, you might have continued to apply social distancing rules for part of the year resulting in lower levels of users and therefore income, or due to public caution previous income levels have not yet returned. 

HMRC have advised that they will only accept a single request to use an alternative method, so it is important to consider all years that have and may be impacted. 

Speak To An Expert

We have assisted many affected partially exempt clients, especially those in the education sector to identify the best approach to take. To find out more, contact one of our VAT team today by completing the form below.


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