Policy paper

Tour Operators바카라 사이트™ Margin Scheme for business to business (B2B) wholesale supplies

Published 18 April 2024

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This publication is available at /government/publications/revenue-and-customs-brief-5-2024-tour-operators-margin-scheme-for-business-to-business-b2b-wholesale-supplies/tour-operators-margin-scheme-for-business-to-business-b2b-wholesale-supplies

Purpose of this brief

This brief clarifies HMRC바카라 사이트™s technical position on the inclusion of business to business (B2B) wholesale supplies within the Tour Operators바카라 사이트™ Margin Scheme (TOMS).

With immediate effect:

Who needs to read this

You should read this if you are a tour operator, and you make B2B wholesale services to other tour operators.

Background

The TOMS is a mandatory VAT accounting scheme for businesses which buy in and sell certain travel services, such as:

  • passenger transport
  • hotel accommodation
  • car hire

Under the TOMS, tour operators cannot recover any VAT on the services they buy in, but only account for VAT on their profit margin. HMRC바카라 사이트™s policy provides tour operators with a choice of whether to apply the TOMS to B2B wholesale supplies. This policy remains unchanged.

HMRC바카라 사이트™s guidance states that TOMS is only mandatory for supplies to final consumers or to businesses for their own consumption (for example, business travel for employees).

Services supplied to another business for onward sale (바카라 사이트˜wholesale바카라 사이트™ supplies) are subject to normal VAT rules, although by concession these supplies can be included in the TOMS.

Following a recent First Tier Tribunal case we have reviewed our approach and guidance on the correct treatment of B2B wholesale supplies, in particular, that contained in Revenue and Customs Brief 5 (2014): Tour Operators Margin Scheme (TOMS).

Position following review

HMRC has concluded that B2B wholesale supplies are within the scope of the TOMS and by concession tour operators may opt B2B wholesale supplies out of the TOMS.

Impact on businesses

This is a technical change to the legal interpretation and will not affect tour operators바카라 사이트™ ability to choose whether to apply the TOMS or not to B2B wholesale supplies.

More information

Tour Operators Margin Scheme (VAT Notice 709/5) has been updated to reflect this technical change.

There is no change to the treatment of the TOMS supplies for consumption by business customers.

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