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With certain exceptions¹, the provision of goods and services for no consideration is not a supply for VAT purposes². Consequently, VAT on costs relating to the provision of such goods and services is not, generally speaking, recoverable. This situation led to many museums and galleries charging an admission fee so that VAT incurred on purchases could be recovered (the admission fee being consideration for a taxable supply³ made in the course or furtherance of a business⁴).

The Government's 2001 pre-election manifesto promised to ensure that the main national museums and galleries would be 'free for everyone from December [2001]'. As a result, VATA 1994, s 33A⁵ was introduced with effect from 11 May 2001 and provides for refunds of VAT in respect of costs which are attributable to free admissions to certain museums and galleries. With effect from 16 March 2016 the scheme is no longer limited to national