TOMS
TOMS makes VAT due on your margin — the selling price less the bought-in cost of travel — not on the full sale. OneSixth runs the provisional calculation each period, handles the departure-date VAT point, and produces the year-end annual adjustment, all linked back to your ledger.
TOMS is mandatory for any business that buys in travel services and resells them in its own name — not just tour operators. It catches conference organisers, event and wedding planners, and management companies. The workflow breaks in three predictable places: the VAT point is the departure date (not the booking date), the scheme runs on provisional VAT during the year, and it all has to be trued up with a year-end annual adjustment. Standard ledgers hold one transaction date and no concept of a provisional margin, so the whole thing ends up in a spreadsheet.
The Tour Operators' Margin Scheme is a compulsory VAT scheme for businesses that buy in travel services (accommodation, transport, car hire) and resell them as principal or undisclosed agent. If you resell travel you bought in your own name, you're likely in TOMS whatever you call yourself — including conference, event and wedding organisers who bundle travel into what they sell.
VAT is due on your margin — selling price less the bought-in cost of the travel — not on the full sale. At the 20% rate the VAT is one-sixth of the margin, and you can't reclaim input VAT on the bought-in travel; it's absorbed into cost. OneSixth calculates the margin percentage, applies it provisionally each quarter, and reconciles it at year-end.
The VAT point under TOMS is departure — VAT becomes due when the customer travels, often months after booking and payment. Because standard ledgers hold only one transaction date, that gap is the root of most TOMS workflow problems. OneSixth tracks departure so revenue lands in the correct VAT period.
Since 1 January 2021 the margin on travel enjoyed outside the UK is zero-rated, while UK travel stays standard-rated under TOMS. Mixed sellers must split the margin between the two — OneSixth handles the split and posts the correct output VAT codes so your return is right.
OneSixth reads bookings and bought-in travel costs from your connected ledger and organises them by departure date.
The provisional margin percentage is applied each period and posted as a reviewable journal — no spreadsheet in the middle.
At year-end OneSixth recalculates the actual margin, sets next year's provisional percentage, and posts the annual adjustment.
OneSixth connects to Xero, QuickBooks Online, Sage and FreeAgent — it calculates the VAT and posts a reviewable journal, it doesn't replace your accounting system.
TOMS is mandatory for any business that buys in travel services (accommodation, transport, car hire) and resells them in its own name as principal or undisclosed agent — not just tour operators. It catches conference organisers, event and wedding planners, and management companies.
VAT is due on your margin — selling price less the bought-in cost of the travel — not on the full sale. At the 20% rate the VAT is one-sixth of the margin, and you can't reclaim input VAT on the bought-in travel; it's absorbed into cost.
Departure. VAT becomes due when the customer travels, often months after booking and payment — and because standard ledgers hold only one transaction date, that gap is the root of most TOMS workflow problems.
Since 1 January 2021 the margin on travel enjoyed outside the UK is zero-rated, while UK travel stays standard-rated under TOMS; mixed sellers must split the margin between the two.
No — none of the major cloud platforms calculate the TOMS margin or the year-end adjustment natively. The standard route is custom tax codes plus a spreadsheet with a manual journal. OneSixth runs the calculation alongside the ledger instead.