- Article 151 bodies – these are International organisations which are outside the scope of VAT.
See below for links to information, or definitions of technical terms
- B2B (Business to business) – The B2B general rule for cross-border supplies of services is that the supply is made where the customer belongs.
- B2C (Business to customer) - The B2C general rule for cross-border supplies of services is that the place of supply is where the supplier belongs, irrespective of the location of their customer.
- Bench fees - Bench fees are fees received by the University in relation to academics visiting from other institutions using our facilities.
- Business Activity - The supply of goods or services in return for consideration.
Note – such activities are business activities for VAT even if they are not profit making and even if they are undertaken by a charity.
- Certificate of Residence - The University is resident in the UK for tax purposes. Sometimes when billing overseas, a customer might ask for a certificate of residence (or a residency certificate) in order to support our request for payment and allow no WHT to be taken. The Tax Team can arrange this.
- Conferences and Events – Various University departments receive income from the provision of conference facilities. The VAT treatment of this income varies dependent on details. Additionally, University departments sometimes hire conference facilities from external providers, including Colleges. We are sometimes able to obtain VAT relief on these costs.
- Consideration - Payment made in return for receiving goods or services. Consideration can be monetary or non-monetary (in kind). If no goods or services are provided in return for the payment, then the payment is not ‘consideration’.
- Corporation Tax – Corporation tax is a corporate tax levied in the United Kingdom on the profits made by UK-resident companies and on the profits of entities registered overseas with permanent establishments in the UK.
- Disability Adaption Works - In general, the supply to an eligible customer i.e. the University of any equipment and appliances that have been designed solely for use by disabled people can be zero-rated.
- Double taxation agreements - also known as DTAs or tax treaties. DTAs are agreements between the UK and other countries which effectively protect against the risk of double taxation where the same income might be taxed in two countries. Because we pay tax in the UK, generally we should not be paying tax overseas as well.
- Education exemption – The provision of education by the University to our students is exempt from VAT. This is because the University is an “eligible body” for the purposes of the education exemption.
- Employment Status - It is important to look at the work performed by a contactor to ensure whether they can be treated as self-employed for income tax purposes.
- Energy Saving Materials - The 5% reduced VAT rate applies to the installation of certain energy-saving materials on residential accommodation.
- EORI number or Economic Operator Registration and Identification number. All businesses within the EU need an EORI Number when importing or exporting any commercial cargo. After Britain leaves the EU, documentation for any goods moving into or out of the UK will need it. The University's EORI number is GB 125 5067 30 065.
- Estates - is responsible for managing the University of Oxford’s estate.
- EU Commission Funding - This funding should be categorised as non-business income for VAT purposes. This means that no VAT is due on the funding received but we cannot reclaim any of the VAT incurred on the direct costs of the research.
- Exempt supplies – Supplies which are within the scope of VAT but which are specifically exempted by law. Sometimes there are very specific conditions which must be met for the exemptions to apply. We cannot reclaim any VAT incurred on the costs associated with making exempt supplies.
- Fuel and Power - The University can obtain gas and electricity at the lower 5% VAT rate providing it is purchased for a “qualifying use”.
- Goods (supply of) - The transfer of the right to dispose of tangible property as owner.
- GST (Goods and services tax) - GST is an indirect tax (or consumption tax) imposed in some countries. It works in the same way as VAT.
- HMRC - Her Majesty’s Revenue & Customs – the body which administers the tax system in the UK.
- Imports – Imports are goods brought into a jurisdiction, especially across a national border, from an external source. The party bringing in the goods is called an importer. An import in the receiving country is an export from the sending country. Importation and exportation are the defining financial transactions of international trade.
- Input Tax - The VAT we incur on our purchases. We can claim some or all of this back from HMRC on our quarterly VAT returns.
- International Tax – International taxation is the study or determination of tax on a person or business subject to the tax laws of different countries, or the international aspects of an individual country's tax laws.
- Intrastat – Intrastat is the system for collecting statistics on the trade in goods between European Union (EU) member states. The supply of services are excluded from Intrastat.
- Lower (VAT) rate - Currently this is 5% in the UK. This rate of VAT applies to specific goods and services such as certain supplies of fuel & power when used for non-business purposes.
- Medical Reliefs - As a charity, the University is entitled to purchase certain goods free from VAT when those goods are used in medical research or training. However, this VAT relief is not available for all such purchases.
Check the details of what can and can’t be zero-rated.
- Non-business activity - Activities undertaken where money is received but nothing is supplied to the funder (and therefore the payment is not consideration) are non-business activities. Providing goods or services for no consideration (of any kind) is also a non-business activity. We cannot normally reclaim any VAT incurred on the costs associated with non-business activities.
- Option to Tax – charging VAT on land and buildings. Once you have opted to tax all the supplies you make of your interest in that land or building will normally be standard-rated, and you will normally be able to recover any VAT you incur in making those supplies.
- OUFAL – Oxford University Fixed Assets Limited is our wholly owned design & build subsidiary company. It is used for constructing zero-rated buildings.
- Output Tax - The VAT we charge on our sales. We declare this and pay this to HMRC on our quarterly VAT returns.
- Outside the scope of UK VAT - Supplies which are usually subject to VAT (in the UK), but which are deemed to be supplied outside the UK and are therefore treated as being outside the scope of UK VAT. These are classed as taxable supplies and therefore provide us with a right to recover any associated input tax. The result is that they are like zero-rated supplies. Note – This term should not be confused with ‘outside the scope of VAT’ altogether (see below).
- Outside the scope of VAT – These items are not within the scope of VAT at all. These are usually non-business activities. No VAT is due on any income which is outside the scope of VAT. Note – This term should not be confused with ‘outside the scope of UK VAT’ (see above).
- Partial exemption - The situation where a VAT registered organisation makes a mixture of both taxable supplies and exempt supplies. In these circumstances a special calculation is required to determine how much VAT can be reclaimed on residual costs.
The University is a partially exempt organisation since the provision of education is exempt from VAT.
- Partial Recovery - Where a cost/purchase/expense is “residual” then we are entitled to recover part of the VAT incurred on that cost. The amount we can recover is determined by the University’s partial exemption calculation which is carried out centrally. The Oracle tax codes are set to take account of this partial recovery.
- Reduced (VAT) rate - See ‘lower rate’ above.
- Research - HMRC’s definition of research is: "original investigation undertaken in order to gain knowledge and understanding. A supply is one of research whenever the activities are directed towards increasing areas of knowledge or understanding.”
- Research Buildings - The University can zero-rate the construction costs of new buildings which are to be used 95% or more for grant-funded non-commercial research. This is based on the intention to use these areas for a "relevant charitable purpose" or “RCP”.
- Research collaborators and sub-contractors – Partner individuals and organisations in research may be collaborators or sub-contractors. This is a matter of fact and affects whether or not VAT must be accounted for on payments.
- Research Costs - VAT may be recoverable on the costs of your research.
- Research Income - Generally, research is outside the scope of VAT when it is funded by the public sector or charitable sector for the wider public benefit. However, this is only a general rule of thumb and each case should be considered on its own merits.
- Residual costs (residual VAT) - Costs which do not relate either:
- solely to taxable activities, or
- solely to exempt &/or non-business activities. The costs relate partly to taxable activities and partly to exempt &/or non-business activities. These tend to be overhead costs and departmental administration costs (provided there is at least some link to taxable supplies).
- Residency certificate - See 'Certificate of Residence' above.
- Residual Recovery - See ‘partial recovery’ above.
- Reverse Charge on Construction Services – This may well apply to invoices received by OUFAL, although implementation is delayed until October 2020.
- Reverse Charge on Services - There are some occasions where we are obliged to account for UK VAT on the purchase of services from overseas suppliers.
- SDLT – You must pay Stamp Duty Land Tax if you buy a property or land over a certain price.
- Services (supply of) - Everything supplied in return for consideration which is not a supply of goods is a supply of services. This includes the supply of a right or the relinquishing of a right.
- Standard (VAT) rate - Currently 20%. ALL supplies of goods and services that we make or receive which are within the scope of VAT are subject to the standard rate of VAT UNLESS they are specifically stated in the law to be exempt or subject to the lower or zero rates of VAT.
- Supply - The provision of goods or services in return for consideration.
- Supply of Staff – When the University supplies a member of staff, VAT reliefs may be available in specific circumstances.
- Taxable supplies - This includes all standard-rated, lower/reduced-rated and zero-rated supplies. The term also includes supplies which are treated as being outside the scope of UK VAT (because they would be subject to VAT if supplied within the UK).
- Tax Coding – All University departments are responsible for their own VAT coding and VAT accounting within Oracle, including reviewing this on a monthly basis.
- Tax Training Courses - The Tax team run a number of training courses on all taxes including bespoke training.
- Teaching - The provision of education by the University to our students is exempt from VAT because the University is an “eligible body” for the purposes of the education exemption.
- VAT – Value added tax.
- VAT on property – Property (i.e. land and buildings) is probably the most complex area of VAT. Due to the amount that the University spends on its Estate, it is also where the largest VAT savings can be achieved.
- VAT on Oracle R12 – In R12, the VAT result is driven by a combination of who we are paying, the project or GL account string and the tax classification code (TCC) used (1-7).
- VAT Returns - The periodic reporting of sales and purchases and the relating VAT to HMRC. VAT returns also detail how much VAT is recoverable, as well as certain aspects of EU transactions. The University completes VAT returns on a quarterly basis. These are completed by the central Tax Team based on information input into Oracle by departments.
- W8 forms - This is a form that US suppliers may ask us to complete to confirm our charitable status with the IRS.
- Withholding tax - or WHT. Withholding taxes are when tax is withheld from (or deducted from the income due to) the recipient by the payer, and directly paid to the government. In most tax jurisdictions, withholding tax applies to employment income (think of PAYE) but some tax systems withhold tax on other forms of income.
Check with the tax team if overseas WHT is relevant to you, as our income can often be exempted from WHT overseas.
- Zero rate - The zero rate IS a rate of VAT, but it is currently set at zero, so no VAT is actually chargeable on such sales. This covers items such as books, most (but not all) food and certain sales of medical equipment amongst other things. Because the zero rate is a rate of VAT these are taxable supplies and we can reclaim in full the VAT incurred on costs solely associated with making these supplies.
- Zero rating on cladding – There is a possibility of zero-rating re-cladding works after the Grenfell fire.
: Finance Division
University of Oxford
23-38 Hythe Bridge Street
Oxford OX1 2JD
: 01865 (6) 16215
- January 2023 Tax News (PDF)
- November 2022 Tax News (PDF)
- September 2022 Tax News (PDF)
- July 2022 Tax News (PDF)
- May 2022 Tax News (PDF)
- March 2022 Tax News (PDF)