In Mandarin Consulting Limited v HMRC [2021] UKUT 0292 (TCC), the Upper Tribunal (UT) found that a company supplying career coaching services was unable to demonstrate that all of its students were usually resident outside of the EU, meaning that UK VAT applied.

MCL appealed to the First Tier Tribunal (FTT), which found that the services supplied by MCL constituted consultancy services for the purposes of Article 59 of the Principal VAT Directive and not educational activities within Article 54.

This meant that where MCL had entered into contracts with the students (before July 2016), the question became where the students had their permanent address or usually resided.

The FTT:

MCL Appealed to the Upper Tribunal (UT) which found that:

As the FTT had erred in law, the UT set the FTT decision aside and remade it, dismissing MCL’s appeal and leaving the result unchanged in respect of periods prior to July 2016.

Useful guides on this topic

Place of supply: Services
The Place Of Supply (POS) of a service determines whether the supply is within the scope of UK VAT and whether VAT is payable on that supply.

Education & VAT
What rate of VAT applies to education? What sort of services are classed as education? What do you do if you have multiple supplies including education? What cases are there on VAT and education?

Career coaching is consultancy and not education for VAT
In Mandarin Consulting Limited v HMRC [2020] TC07714, a career coaching service to Chinese students was found to be a supply of consultancy services and not of education. The place of the supply for VAT turned on whether the supply was made to students staying in the UK or their parents in China.

External link

Mandarin Consulting Limited v HMRC [2021] UKUT 0292 (TCC)

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