HMRC’s Notice 700 has been updated to clarify VAT treatment of mobile phone contracts and packages. The key change is that no input tax can be recovered when an employee holds a contract in their own name. The guidance also confirms recoverability rules for business‑only mobile and broadband services, and outlines apportionment requirements for private use.
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Key Takeaways
No input tax recovery is available for such contracts.
All input tax incurred on recurring fixed monthly call packages is recoverable, provided the business prohibits private use or it is minimal.
The business can recover VAT on the private use but must account for output tax on the amounts charged to employees.
Primary source
Read the full article at Marcus Ward Consultancy LtdThis summary was published on VATfaqs.com on 3 July 2026. It relates to VAT developments in United Kingdom. The original source is Marcus Ward Consultancy Ltd.
