PE77300 - Guidance for specific trade sectors: Lloyd's VAT arrangements: Syndicates - Partial Exemption method

The tax year will be 1 January to 31 December with the annual adjustment declared in the December quarter of that tax year.

The partial exemption agreement will comprise at least the following components:

SECTOR 1 - UNDERWRITING

The calculation will be based on premiums processed, both through LPSO and elsewhere. Premiums processed by LPSO will be notified on summary reports.

Premiums will be coded by LPSO as follows;

• X = exempt and outside the scope with no input tax credit
• Z = outside the scope (O/S) with input tax (I/T) credit
• M = mixed, this will be split 50/50 to X and Z

The sector recovery calculation will be;

Value of premiums O/S with I/T credit = recoverable % (to 2 decimal places)
Value of total premiums

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SECTOR 2 - INVESTMENTS

The calculation will be based on either the number or the value of securities sales.

The sector recovery calculation will be;

Number of value of O/S with I/T credit sales of securities = recoverable % (to 2 decimal places)
Number or value of total sales of securities

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