Are insurance Companies VAT reg ?

chas2008 | 10:26 Thu 17th Feb 2011 | Insurance

4 Answers

i know logically they should be i have but i am being led to believe they are not, certainly within the motor claims side of things..

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JackDanielsU

Insurance and reinsurance transactions, and services related to insurance and reinsurance performed by insurance brokers and insurance agents, are exempt from VAT (VATA94/SCH9 Group 2). In practice, however, most insurance companies make both exempt and taxable supplies and will have partial exemption for VAT purposes.

http://www.hmrc.gov.u.../gimanual/gim4270.htm

chas2008

Question Author

that makes sense, i thought they would be a VAT element there somewhere

chas2008

Question Author

oops, bit early-
'i thought there would be a VAT element in there somewhere'
'

wishy123

From a claims perspective, insurers are unable to reclaim VAT. Hence if you are VAT registered and make a claim, you would be responsible for the VAT element of the repair invoice (repairer would supply you with a separate VAT invoice so you can reclaim it from HMRC).

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