Tax and VAT

Frequently asked questions

The hardest thing in the world to understand is the income tax
Albert Einstein

What is the LSE’s VAT Registration Number?

The School’s VAT Registration number is GB629588094

 

Should I budget for VAT on costs?

The majority of the supplies that the School makes are supplies of education, and research. These supplies are mainly VAT exempt and non-business supplies respectively. There are special rules relating to deductibility of VAT suffered by an organisation making such supplies, which means that the School cannot recover the VAT incurred on the majority of its expenditure on goods and services: the full cost including VAT will therefore, in most cases, represent a direct cost, ie a VAT- inclusive charge to the relevant School budget.

If, however, a specific cost is linked directly to generating taxable income – for instance if you have sent out Standard rated (VAT) Sales invoices to your customers; or you have set up a product via online store which is Standard rated for VAT – then it is possible that VAT on this cost can be recovered. You should contact the VAT Manager, Rudy Ghosh Room LRB502 (ext.6268) or email r.ghosh1@lse.ac.uk

I’m new to the LSE. Is there a VAT Guidance page?

For all other VAT matters please refer to the VAT Guidelines document, or contact the VAT Manager, Rudy Ghosh Room LRB502 (ext.6268) or email r.ghosh1@lse.ac.uk

Why do I see a transaction in my Financial Report with the words: VAT Reverse Charge?

Where the School receives the services of Consultants, Lawyers, Accountants, Data processing and other similar services from outside the UK, then under HMRC’s Reverse Charge rules, the School has to charge itself VAT on these services.

Where a reverse charge VAT is due, there are some instances where the charge can be reversed where it can be proved that it is outside the scope of VAT – for instance where the supplier is a named collaborator in a funding agreement between the School and the Funder funding the project.

The VAT Manager uploads quarterly journals to account for reverse charges and declares these via the School's VAT Returns. Where you are not sure about the charge or don’t feel that a reverse charge is due (per the above paragraph) please don’t hesitate to contact the VAT Manager, Rudy Ghosh Room LRB502 (ext.6268) or email r.ghosh1@lse.ac.uk 

Should I charge VAT on my Invoice/ Eshop Product?

Please use the School’s VAT Toolkit situated in the Online Store to determine the VAT status of your product type/ income stream. If your product type/ income stream is neither listed in the School’ then please e-mail the VAT Manager, Rudy Ghosh: r.ghosh1@lse.ac.uk

I have a question on Payroll Tax. Who should I contact?

For advice related to employment tax matters please contact the School’s Payroll Department.

My Accountant has asked me for a P11D. Where do I get this from?

Please contact the Tax Manager, Rudy Ghosh Room LRB502 (ext.6268) or email r.ghosh1@lse.ac.uk

Do I pay tax on expense claims?

Please refer to the following:

1)      The School’s Travel and Subsistence Policy including the Air Class Travel Policy can be found in this link. All payments and reimbursements that don’t meet the School’s policy will be treated as a benefit in kind for tax purposes. For more clarity don’t hesitate to contact the Tax Manager Rudy Ghosh: r.ghosh1@lse.ac.uk

2)      All other guidance on expenses including Staff and Business Entertainment can be found on the AP user guide.

3)      For tax advice related to payroll benefits (including Childcare vouchers, and Cycle to work scheme) please refer to the Payroll Webpage.

Can I pay Stipends to Visiting Fellows?

Academic visitors to the School who are primarily employees of another institution who do not have a contract of employment with the University, and are only hosted in the LSE for a short period time can be paid as follows:

  • reimbursement or provision of payments to cover expenses is generally allowable for tax;
  • payment of additional fees, honoraria, stipends, etc. will usually be taxable and will require the payroll department to determine residency & employment status of the payee.

If there is no contract of employment, and the academic in invited purely to conduct his/her own research, with no further contribution to department then it could be deemed to be outside the scope of employment tax.

Refer to the Short Term Visitor Flow-chart for determining the tax status of academic visitors.

I need a Certificate from HMRC to show that the LSE is resident (for tax purposes) in the UK. Who should I contact?

 

The Tax Manager is required to write to HMRC to request Double Taxation Treaty certificates. It can sometimes take up to a month to receive these certificates. Please email the Tax Manager, Rudy Ghosh r.ghosh1@lse.ac.uk

What is the School’s Tax Strategy?

Please click on this link for the School’s Tax Strategy. Any questions about the strategy may be directed to the Tax Manager, Rudy Ghosh Room LRB502 (ext.6268) or email r.ghosh1@lse.ac.uk.