Partial Exemption VAT Services That Maximise Your Input Recovery
Reclaiming the right amount of VAT when you make both taxable and exempt supplies is one of the trickiest areas in VAT. ABM Chartered Accountants handles your partial exemption calculations, method applications, and annual adjustments so you recover every pound you are entitled to.
Recover More VAT on Your Mixed Costs
Partial exemption applies when your business makes both taxable and exempt supplies. It limits how much input VAT you can reclaim on costs that serve both sides of the business. Getting the calculation wrong means either under-recovering VAT or over-claiming and facing penalties. ABM Chartered Accountants gets the balance right every quarter.
Our ICAEW and ACCA qualified accountants handle the full partial exemption process, from attributing input tax to the correct supply category, through to applying the standard method or designing a special method that better reflects how your business actually uses its resources.
What Our Partial Exemption Service Covers
From standard method calculations to HMRC special method applications, here is how ABM Chartered Accountants ensures your partial exemption is handled accurately and your recovery is maximised.
Standard Method
Calculating your recoverable input tax each quarter using the HMRC standard method turnover formula.
Special Method Application
Designing and applying to HMRC for a partial exemption special method tailored to your business.
De Minimis Review
Checking whether your exempt input tax falls within the de minimis limits so you can recover it all.
Annual Adjustment
Completing your year-end partial exemption adjustment to reconcile provisional and actual recovery.
HMRC Negotiations
Representing you in discussions with HMRC over method approval, overrides, or compliance queries.
Ongoing Compliance
Quarterly partial exemption calculations built into your VAT returns with full audit trail records.
Claim What You Are Entitled To, Accurately
Many partially exempt businesses under-recover VAT simply because the standard method does not reflect how their costs are actually used. A well-designed special method can significantly increase your recovery rate. ABM Chartered Accountants reviews your position, identifies whether a better method exists, and manages the HMRC approval process from start to finish.
Equally important is the annual adjustment. Each quarter’s recovery is provisional, and the year-end recalculation often produces a different result. If this is not handled properly, you either pay back VAT unnecessarily or face an HMRC challenge. We complete your adjustment accurately and on time every year.
Partial Exemption VAT Support for Businesses Across the UK
Based in Canary Wharf, London, ABM Chartered Accountants provides partial exemption VAT services to businesses and groups throughout the UK. Our approach is technically rigorous and commercially practical.
Partial Exemption Expertise for Complex Sectors
We handle partial exemption for businesses in financial services, property, healthcare, education, housing, insurance, and charities. These are the sectors where mixed supplies are most common and the calculations matter most.
Why Businesses Choose ABM for Partial Exemption
Chartered VAT Specialists
ICAEW and ACCA qualified with partial exemption depth.
Recovery Maximised
Standard or special method applied for best recovery.
Annual Adjustment Handled
Year-end reconciliation completed accurately and on time.
How We Work
Initial Consultation
Set Up and Onboard
Ongoing Support
We provide regular reviews and proactive advice to keep your finances optimised and HMRC-compliant.
Get in Touch Today
Whether you need help with your tax return, payroll, VAT, or business advisory, our qualified UK accountants are ready to provide clear, practical guidance for your specific needs.
Book a Consultation
Fill in the form below and one of our expert accountants will contact you promptly to discuss your accounting and tax requirements.
Our Global Clients
Frequently Asked Questions
Here are answers to the partial exemption questions we hear most often. Contact our team for tailored guidance.
What is partial exemption?
Partial exemption applies when your business makes both VAT-taxable and VAT-exempt supplies. It limits how much input VAT you can reclaim on costs that are shared between taxable and exempt activities. The rules require you to calculate the recoverable proportion each quarter.
What is the standard method?
The standard method calculates your recoverable percentage by dividing the value of your taxable supplies by your total supplies. This percentage is then applied to your residual input tax to determine how much you can reclaim. No HMRC approval is needed to use the standard method.
When should I use a special method?
If the standard method does not produce a fair and reasonable result for your business, you can apply to HMRC for a partial exemption special method. ABM Chartered Accountants designs the method, prepares the application, and manages the HMRC approval process.
What is the de minimis rule?
If your exempt input tax averages less than 625 pounds per month and is less than 50 percent of your total input tax, it is treated as insignificant. You can then reclaim all your input tax as if you were fully taxable for that period.
What is the annual adjustment?
The annual adjustment is a year-end recalculation that compares the VAT you recovered during the year with what you should have recovered based on actual full-year figures. ABM Chartered Accountants completes this adjustment and includes it in your next VAT return.
How much do your partial exemption services cost?
Fees depend on the complexity of your supplies and whether a special method application is involved. We offer transparent pricing for quarterly calculations and annual adjustments. Contact ABM Chartered Accountants for a quote tailored to your business.