Global Market Recovery Rate
1. The Global Market Recovery Rate (GMR) for the year ended 31 December 2021 is 86.95%.
2. As set out in Lloyd’s VAT Arrangements, Corporate Members, Limited Liability Partnerships (LLPs) and Scottish Limited Partnerships (SLPs) who are VAT registered on account of activities other than insurance underwriting may use the GMR where the number of syndicates on which they participate makes it difficult for them to calculate the composite recovery rate for those syndicates.
3. Those Corporate Members, LLPs and SLPs are therefore able to recover 86.95% of any input VAT incurred in relation to their Lloyd's underwriting activities in the year 2021.
4. The annual adjustment for the year 2021 is to be declared in the VAT return for the quarter ended 31 March 2022.
5. Input VAT recovery during 2022 should also be based on the GMR for 2021 (i.e. 86.95%), until the actual recovery rate for the year ended 31 December 2022 is advised (in April 2023).
6. Please note that Corporate members, Limited Liability Partnerships (LLPs) and Scottish Limited Partnerships (SLPs) that solely participate on syndicates that write only UK business are not be permitted to use the GMR.
The increase in the GMR is a result of the extension of the Specified Supplies Order (SSO) post-brexit. Prior to the end of the transitional period for the UK exiting from the European Union (EU), the SSO only provided a right to deduct input tax in relation to specified supplies made to customers belonging outside the EU. With effect from 1 January 2021, the SSO was extended to include specified supplies made to customers also belonging in the EU. For further information, please refer to our article on the Taxation News page here.
For full details of the Lloyd’s VAT Arrangements, please refer to Market Bulletin Y2507: Lloyd's VAT arrangements (Y2507) - 1 January 2000 (94.5KB)
If you have any queries regarding the GMR, please contact one of the Indirect Tax team in Lloyd's Tax Department.