The Treasury advises that the above Order has been made and has effect in relation to supplies of services made on or after 1 March 2019.
The Order restricts the application of the Value Added Tax (Input Tax)(Specified) Supplies Order 1999 to ensure that input tax recovery is limited in the case of supplies of insurance intermediary services to cases where the final consumer of those services belong outside the Island or United Kingdom, as intended. This is necessary to close down a VAT avoidance scheme which relies on VAT rules which allow recovery of input tax incurred on exempt financial services supplied to recipients outside the European Union.
Further details can be obtained by contacting the Advice Centre on + 44 1624 648130.
