VATFIN2500 | Money (including transfer of money) and related services: outsourcing

As has been seen in VATFIN2410 and VATFIN2420 banks tend to outsource their counting, sorting and stocking services to companies that specialise in these areas. But banks and other financial institutions are now increasingly outsourcing other aspects of their business, such as account operations (see VATFIN2950). The thing to remember when looking at the service being provided by the outsource company is whether that service fulfils the specific essential functions of a transaction exempted under the finance exemption (see VATFIN2200). If a bundle of services have been outsourced you will need to identify whether what is being provided is a single composite supply or are multiple supplies (VATSC80000) and then what the core service of that supply is.