VAT Cases & News

Summaries of interesting VAT cases for the SME owner.

In Balhousie Holdings Limited v HMRC [2021] UKSC 2019/0103, the Supreme Court found that Balhousie was not liable to a VAT self-supply charge arising from the sale and leaseback of a new care home following acquisition from a developer. It had retained its entire interest throughout.

In Knightsbridge Accountants Ltd v HMRC [2021] TC8026, the First Tier Tribunal (FTT) disallowed input tax claimed on the purchase of a commercial property, there was no evidence to show that the purchaser had legal or beneficial ownership of the property.

HMRC have published a summary of responses to their 2019 consultation 'Call for evidence: simplification of partial exemption and the Capital Goods Scheme'. HMRC are changing internal processes and will engage further on this topic with stakeholders in the future.

Revenue & Customs Brief 4 (2021): 'Partially exempt VAT registered businesses affected by Coronavirus (COVID-19)' outlines an accelerated process to request temporary alterations to partial exemption methods to reflect changes in business practices due to Coronavirus. 

In Virgin Media Limited v HMRC [2020] UKFTT 30, the Court of Appeal has refused permission to appeal over how VAT was accounted for on supplies of services to customers.

In The Wellcome Trust Ltd v HMRC (Case C-459/19) (17 March 2021), the Court of Justice of the European Union (CJEU) held that services supplied to a taxable person who acquired those services exclusively for its non-business activities were nonetheless to be regarded as supplied to a taxable person 'acting as such'. Consequently, it was necessary for the recipient of those services to account for VAT under the reverse charge.

In Imprimatur Capital Holdings Ltd T vs HMRC [2021] TC08006, the First Tier Tribunal (FTT) concluded that only the services to third-party clients were made for consideration, therefore amounted to an economic activity and entitled to input tax recovery on those services.


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