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Staff

This page outlines the role of VAT in relation to University staff.

Supplies of Staff

The University makes a supply of staff for VAT purposes if it provides to another body the use of an individual who is contractually employed by the University. The determining factor is that the staff are not contractually employed by the recipient company, but come under the direction of that company as they would if they were employees. Under these circumstances the supply is taxable at the standard rate.

If staff are performing services on behalf of the University to the customer, then the VAT liability is determined by the nature of the service that the University is providing.

If there is a joint contract of employment then there will be no supply, and therefore should be treated as outside the scope of VAT.

Supplies to other Educational Institutions

The supply of teaching staff to another educational institution for teaching purposes is exempt from VAT. The exemption does not extend to the supplies of teaching staff for other duties (e.g. administration).

Supplies to other Charitable Bodies

Certain supplies of staff by the University to other charitable or non-profit making bodies may be treated as non-business income and therefore outside the scope of VAT. The conditions for this concession are:

• The employee seconded should only be engaged in the non-business activities of the University, and be seconded to assist in such activities of the borrowing organisation.
• The payment for the supply of the employee’s services does not exceed the total cost incurred by the University in respect of salary, NIC, pension costs, etc. This should be calculated pro rata for part-time secondments.

Supplies of University staff to other charitable or non-profit making bodies, which do not qualify under the above rules, should be treated as taxable at the standard rate.

Staff working overseas

Please contact the Finance Service Desk if you are considering supplying University staff to work overseas. The VAT rules for this are more complex and staff working overseas may also be liable for local income tax and social security depending on the duration and nature of the contact.