Selling travel to a company does not take it outside the Tour Operators' Margin Scheme (TOMS). Travel the company uses itself stays within the scheme, without a VAT invoice for its purchase. Wholesale travel bought for resale can qualify for an opt out.
Your corporate customer may expect to reclaim VAT on every supplier invoice. Address that expectation before they approve your quote.
First, establish what your customer will do with the travel, then look at what you supply. Our guide to who has to use TOMS and how the margin is taxed explains the wider scheme. Here, we focus on company bookings, invoice wording and conference packages.
Why does TOMS apply to business travel?
TOMS covers relevant travel services you buy in and resell in your own name. It can apply even when travel is only part of your business. An events organiser providing delegate accommodation can fall within it, just as a tour operator can (709/5 paras 2.1 to 2.3).
Sales to business customers include travel used by their employees and wholesale supplies for resale. Both are within the scheme, although wholesale supplies have an opt out. A booking labelled "business to business" does not settle its treatment (709/5 para 3.1).
The word "traveller" has a wider meaning here than someone carrying a suitcase. It includes a business or local authority receiving travel for its own use. The distinction is whether the recipient receives the supply for resupply (709/5 para 2.8).
Travel consumed by a company or its employees cannot be excluded from TOMS. An employee travelling for work still counts as business consumption (709/5 para 3.3).
For your booking process, ask one direct question: will your customer use this travel itself or sell it on? Record the answer alongside the quote.
What should your invoice to a company say?
You cannot issue a VAT invoice for a supply accounted for under TOMS. HM Revenue and Customs (HMRC) explains that the tax is not usually known when the supply happens. It can only be determined after the financial year ends and the annual TOMS calculation is performed (709/5 para 4.19).
Your invoice for travel used by a business must show that TOMS applies. HMRC gives two acceptable forms of wording: "this is a Tour Operators' Margin Scheme supply" or "this supply falls under the Value Added Tax (Tour Operators) Order 1987" (709/5 para 4.19).
Tell your corporate customer at quote stage that there will be no VAT to reclaim on your TOMS trip. They need that information for a fair price comparison.
The absence of a VAT invoice does not mean the scheme ignores VAT. On Margin Scheme supplies, you account for VAT on your margin. You cannot reclaim the VAT on the travel you buy in for resale. The scheme also accounts for in-house services included in a package (709/5 para 2.6).
Commission you pay an agent for arranging United Kingdom (UK) Margin Scheme supplies is standard-rated. This applies even where the travel is enjoyed outside the UK (709/5 para 4.18).
Can you opt out for wholesale travel or school trips?
Business to business (B2B) wholesale travel is within TOMS, with a concession allowing you to opt out. If you opt out, normal place of supply and liability rules apply. Passenger transport is supplied where it takes place; accommodation is supplied where it is situated (709/5 para 3.2; Revenue and Customs Brief 5 (2024), Position following review). Model both treatments before choosing, using your actual itinerary, supplier costs and selling terms.
Educational trips containing Margin Scheme supplies must use TOMS unless the school body receiving them will resell them. Where you are unsure whether resale will happen, use TOMS (709/5 para 3.4).
Ask the school contact who is buying your supply and what happens next. Keep their response with the booking paperwork.
How do conferences, delegate hotels and coaches fit together?
A conference you assemble from hired rooms, equipment and staff is an in-house supply. "In-house" does not require you to own the venue or every screen on the stage (709/5 para 7.12).
Sold alone, without Margin Scheme supplies in the same transaction, that conference follows normal VAT rules. It can carry a normal VAT invoice (709/5 para 2.13).
Delegate hotels and passenger transport you buy in and resupply have different treatment. They are Margin Scheme supplies and go through TOMS when the business customer uses them itself. They do not become part of your in-house conference merely because they support the event (709/5 para 7.13).
When sold together as one package, the conference and bought-in travel enter the TOMS calculation. The in-house conference is identified within that calculation and accounted for under normal rules (709/5 para 2.13). Our explanation of how a package with your own services is split covers that calculation in more detail.
A conference with delegate accommodation and transport
Illustrative example, not a real business. A Manchester events company organises a two-day sales conference for a client. It hires the venue, the screens and the staff itself. It also books 60 delegate rooms at a nearby hotel and a coach from the station.
| What the company provides | Charge |
|---|---|
| Organised conference | £18,000 |
| Delegate rooms and coach | £14,400 |
| Combined package | £32,400 |
Sold together as one package, the whole £32,400 goes through the TOMS calculation. The conference is accounted for at its own VAT rate within it. Including the conference in that calculation does not turn it into bought-in travel (709/5 para 2.13).
The package cannot carry a VAT invoice. Its invoice must say TOMS applies, using suitable wording such as "this is a Tour Operators' Margin Scheme supply" (709/5 para 4.19).
If the client buys the conference in one transaction and arranges its own rooms and coach, the position changes. The £18,000 conference is an in-house supply under normal rules and can carry a VAT invoice. In that case, the events company supplies the conference alone (709/5 para 2.13).
Keep the conference costs separate from the bought-in travel costs in your records. TOMS requires records of total package selling prices and separate direct costs for the different supply types (709/5 para 5.6). Your booking records should make that distinction easy to follow.
What should you check this quarter?
- Ask corporate buyers whether they will use the travel themselves or resell it.
- Record their answer with the quote and booking terms.
- Check that your TOMS invoice template carries the required wording.
- Explain the lack of reclaimable VAT before corporate buyers approve the price.
- Review wholesale bookings before choosing their treatment.
- Check that conference records distinguish event costs from bought-in hotels and transport.
We can review those decisions with your booking and finance records together. Our accountants for travel agencies and tour operators can help you turn the findings into clear quoting instructions, invoice wording and records your staff can maintain.
Frequently asked questions
Can my corporate client reclaim VAT on a trip I sell them?
Your corporate client cannot reclaim VAT on a trip supplied under the Tour Operators' Margin Scheme (TOMS). You cannot issue a VAT invoice, including when employees use the travel for work. Explain this when quoting, so the customer compares prices without assuming a VAT deduction.
What must the invoice to a business say?
An invoice for business use must indicate that the Tour Operators' Margin Scheme (TOMS) applies. Acceptable wording includes "this is a Tour Operators' Margin Scheme supply". It is not a VAT invoice. The tax cannot usually be established when you invoice, because it depends on the year-end calculation.
Can I take business travel out of TOMS?
Travel cannot leave the Tour Operators' Margin Scheme (TOMS) when a business or its employees consume it themselves. Wholesale supplies to a business for resale are different: you may choose to exclude those. Establish what your customer will do with the travel before considering that choice. A company name alone does not establish resale.
Are school trips covered by TOMS?
Educational school trips containing Margin Scheme supplies fall within the Tour Operators' Margin Scheme (TOMS). If the school body receiving your supply will resell it, the wholesale rules become relevant. When you are unsure whether the supply will be resold, you should use TOMS. Ask about onward sale during booking and keep the answer with your records.
Sources
Every rule in this article was checked against these pages on 22 October 2026.
