In Royal Opera House Covent Garden Foundation v HMRC [2021] EWCA Civ 910, the Court of Appeal (CA) upheld the Upper Tribunal's (UT) decision that there was no direct and immediate link between Opera production costs and the sale of food and drink that would allow the input VAT on the former to be deductible.
VAT Cases & News
Summaries of interesting VAT cases for the SME owner.
HMRC is writing to VAT-registered businesses this month to tell them that any VAT direct debits will be cancelled if HMRC does not hold an email address for them. This is in order for HMRC to comply with UK banking regulations.
HMRC have published Revenue & Customs Brief 9 (2021): ‘VAT liability of daycare services supplied by private bodies in England and Wales’ following recent Court of Appeal cases.
HMRC have published Revenue & Customs Brief 8 (2021): 'VAT treatment of public funds received by further education institutions' which provides interim guidance following the Colchester Institute Corporation decision until the position is further tested.
In Colchester Institute Corporation v HMRC [2020] UKUT 0368, the Upper Tribunal held that funding provided to a college by government agencies constitutes an economic activity for VAT purposes.
In HMRC v Tower Resources PLC [2021] UKUT 0123, the Upper Tribunal (UT) rejected an appeal by HMRC that a holding company adding the fees for management services provided to subsidiaries to inter-company loans constituted taxable supplies for VAT.
In Kingston Maurward College (KMC) v HMRC [2021] TC8108, the First Tier Tribunal (FTT) found that the provision of free education/vocational training to students where funding is provided by government agencies is an economic supply of services for consideration. KMC was entitled to input tax recovery but failed under the partial exemption rules.
- Morrison tastes £1m VAT defeat as snack bars are not cakes
- R & C Brief 7 (2021): VAT liability of charging electric vehicles
- Leicester City Council 'sports amendment' out of time
- R & C Brief 6 (2021): VAT liability of juice cleanse programmes
- Call for Evidence: Simplifying the VAT land exemption
- R & C Brief 5 (2021): VAT liability of installation of blinds