VAT News

VAT & Partial Exemption – Ability to adjust for Covid Impact


We wanted to remind those clients who operate Partial Exemption Methods and whose business has been impacted by COVID 19 that in March last year HMRC announced in RCB 4/21 “an accelerated process for VAT registered businesses to request temporary alterations to their partial exemption methods (including combined methods) to reflect changes to their business practices because of the coronavirus (COVID-19) pandemic.”

If your income levels and partial exemption recovery percentage has been affected by Covid then there is scope to review your calculations from 2020 onwards and submit a request and claim to HMRC based on an alternative method. 

It is worth noting that requests can include the current year if there is an ongoing impact from Covid in your organisation, for example you might have continued to apply social distancing rules for part of the year resulting in lower levels of users and therefore income or due to public caution previous income levels have not yet returned. 

HMRC have advised that they will only accept a single request to use an alternative method, so it is important to consider all years that have been and may be impacted. 

We have assisted many affected partially exempt clients especially those in the education sector to identify the best approach to take and if you would welcome a conversation and support to help your organisation then please give your usual Centurion adviser a call or email us at

For the avoidance of doubt, the content recorded in this news article does not constitute formal advice and we do not guarantee the accuracy of any information provided at the time of reading. It is always recommended that you seek professional advice before acting on any of the news articles or information included.

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