The Value Added Tax (General) (Amendment) Regulations 1989

Explanatory Note

(This note is not part of the Regulations)

These Regulations, which come into force on 1st August 1989, further amend various provisions of the Value Added Tax (General) Regulations 1985 (“the principal Regulations”).

Regulations 3, 4 and 5 delete regulations 19, 20 and 23 respectively of the principal Regulations and substitute new regulations. The main amendments are:

the new regulation 19 extends to grants of those tenancies and leases whose supply is treated as a supply of goods, and new regulation 20 extends to supplies of water, gas and electricity the facility at present available under regulation 23(2) for continuous supplies of services, whereby a single invoice may be issued for payments due up to a year in advance. These extensions arise from the forthcoming changes in liability of these supplies and are designed to accommodate existing billing practices;

the new regulation 23 introduces no substantive change but has been redrafted in a form consistent with the new regulations 19 and 20. These have, in turn, been drafted to reflect more closely the primary legislation under which they are enacted (section 5(9)(a) of the Value Added Tax Act 1983). The changes introduce, by way of clarification, the concept of successive and separate supplies.

Regulation 6 amends regulation 31(2) of the principal Regulations. This amendment is in consequence of the repeal of the Banking Act 1979 (c. 37) and its replacement by the Banking Act 1987 (c. 22).