Liability ― fund management and other investment management

Produced by a Tolley Value Added Tax expert

Value Added Tax

Guidance

This guidance note covers the liability of fund management services and some other investment management services.

For an overview of liability more broadly, see the Liability ― overview guidance note.

For in depth commentary on the legislation and case law on the liability of fund management see also De Voil Indirect Tax Service V4.136G.

A review of the fund management exemption published in 2023 concluded that there was no need to amend the UK legislation to clarify its scope.

Fund management ― the basics

The management of certain funds is exempt from VAT. A range of categories of fund are covered by this exemption. Such funds are referred to collectively as special investment funds (or SIFs) although this is technically the terminology used in EU VAT legislation. SIFs include certain open-ended and closed-ended investment undertakings, umbrellas and sub-funds, as well as some pension schemes.

The fund management exemption is limited to the management of SIFs. Consequently, the management

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