PE77550 | Guidance for specific trade sectors: Lloyd's VAT arrangements: corporate members - Partial Exemption method

The annual adjustment will be declared in the first quarter following the end of their VAT tax year.

The partial exemption agreement will comprise at least the following components:

SECTOR 1 - INVESTMENTS

The calculation will be based on either the number or value of securities sales.

The sector recovery calculation will be;

Number or value of O/S with I/T credit sales of securities = recoverable % to 2 decimal places
Number of value of total sales of securities

SECTOR 2 - SYNDICATE UNDERWRITING

The calculation will be based on the premiums processed through LPSO and elsewhere.

The sector recovery calculation will be;

Value of premiums O/S with I/T credit = recoverable % to 2 decimal places
Total value of premiums

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Where the corporate member participates on a number of syndicates which makes the above calculation difficult, the Global Market Rate may be used in its place for this sector subject to agreement with HM Revenue & Customs. However those members that participate solely on syndicates which write only EU business will not be permitted to use the Global Market Rate or recover input tax in relation to these supplies.

Where a corporate member owns 100% of the capacity on a syndicate consideration will need to be given to establishing a further sector for this activity.