In Gray & Farrar International LLP v HMRC [2021] UKUT 0293, the Upper Tribunal (UT) a dating matchmaking service was confirmed to be a supply of consultancy for VAT. This means that is outside the scope of VAT when dealing with non-EU clients.

  • A high-end matchmaking facility provided three levels of service: Club, Custom and Bespoke, with fees ranging from £15,000 to £140,000 per annum.
  • The key elements of the service were:
    • The interview and vetting process.
    • The preparation of the brief (of the client's requirements).
    • The matching process.
    • The post-introduction liaison.
  • All but the last element were predominantly carried out by the managing partner.
  • Gray & Farrar believed the services fell within the definition of consultancy services and the provision of information as per Article 59(c) of the Principal VAT Directive.
  • HMRC disagreed and on Appeal to the First Tier Tribunal (FTT), it was held that consultancy services could be defined as the "provision of information and expert advice" and that "data processing and the provision of information" were two separate references and did not require the provision of both in order to fall within Article 59(c).
  • The tribunal ruled that the post-introduction services were a material element of the services provided and so 'went beyond' the definition of consultancy services. The appeal was dismissed.

Gray & Farrar appealed to the UT, which held:

  • The FTT had erred in law by failing to properly characterise the supply in this case and the decision was re-made.
  • The predominant element of the supply as judged by the typical consumer was the provision of an introduction to a prospective long-term partner, which contained advice and the provision of information.
  • The other elements, whilst not inconsequential, did not prevent the other services forming the predominant element.
  • As such, the services did fall within the provision of consultancy services and information within Article 59(c).

The appeal was allowed.

UPDATE: HMRC has been granted permission to appeal to the Court of Appeal. Listed for hearing on 17 or 18 January 2023.

Useful guides on this topic

VAT Place of supply of services 
For services made to a non-business customer, UK VAT is charged unless the service is covered by an exception to the general rule.

External link

Gray & Farrar International LLP v HMRC [2021] UKUT 0293


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