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VAT Rules for Auctions

Items offered for auction in the United Kingdom (UK) or the European Union (EU) can either be sold under the Auctioneers' Margin Scheme or under the normal Value Added Tax (VAT) rules.

HM Revenue and Customs (HMRC) set out the rules for these schemes under VAT Notice 718 (Auctioneers' Margin Scheme) and VAT Notice 600 (Normal VAT Rules) respectively.

Essentially, the lot's bid (hammer) price, the buyer's premium and any other charges relating to the lot (such as collection or storage charges) may be liable for VAT under these schemes.

Bearnes Hampton & Littlewood Limited offers the majority of lots under the Auctioneers' Margin Scheme. We indicate how VAT will be charged using the following notices.

Auction Lot VAT Notices

VAT on Buyer's Premium The lot is being sold under the Auctioneers' Margin Scheme. VAT at the prevailing rate will be charged on the buyer's premium, but not on the bid (hammer) price.
No VAT Applicable The lot is being sold under the Auctioneers' Margin Scheme. The transaction will not attract VAT on either the bid (hammer) price or the buyer's premium.