Supply and consideration ― is the supply for consideration?

Produced by a Tolley Value Added Tax expert

Value Added Tax

Guidance

This guidance note looks at when a supply is made for consideration for VAT purposes.

For an overview of supply and consideration generally, see the Supply and consideration ― overview guidance note.

For detailed commentary on the legislation and case law, see De Voil Indirect Tax Service V3.112.

What is the meaning of consideration?

Consideration is the ‘payment’ made for a supply of goods or services. It is usually a payment in money, but it can also be non-monetary consideration, such as supplies of goods or services that are provided in exchange (for example a barter transaction or part exchange).

HMRC cites the following definition in its guidance (even though the European law from which this is taken is no longer in force and the UK has left the EU):

‘“Consideration” means everything received in return for the supply of goods or the provision of services, including incidental expenses (packing, transport,

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