Category: VAT

Harrods (UK) Ltd v Revenue and Customs: VDT 1 Nov 2005

VDT VALUE ADDED TAX – Direction to pay costs to the successful party (the Appellant) – rule 29(1) of the VAT Tribunals Rules 1986 – whether costs should be awarded on the standard basis or alternatively on the indemnity basis – CPR rule 44.4 applied by analogy – in the light of their conduct of the litigation, the Commissioners directed to pay costs on the indemnity basis

Citations:

[2005] UKVAT V19318

Links:

Bailii

Statutes:

VAT Tribunals Rules 1986 29(1)

Citing:

Cited – Reid Minty (a firm) v Taylor CA 2002
New CPR govern Indemnity Costs awards
The defendant had successfully defended the main claim and now appealed against the refusal of an order for costs on an indemnity basis even though judge thought that the claimants had behaved unreasonably. He had said that some conduct deserving of . .
Lists of cited by and citing cases may be incomplete.

VAT, Costs

Updated: 04 July 2022; Ref: scu.238043

Barclays Bank Plc v Revenue and Customs: VDT 24 Oct 2005

VDT VALUE ADDED TAX – preliminary issue – input tax – supplies of credit made by the Appellant to customers who exported goods outside the member states – whether there was a difference in meaning between the words ‘goods to be exported’ which appeared in the Sixth Directive and the words ‘the export of goods’ which appeared in national legislation – no – if there were a difference whether it was possible to interpret national law in a manner consistent with the Directive – yes – appeal on this issue dismissed – VATA 1994 S 26(1)(c) – Value Added Tax (Input Tax) (Specified Supplies) Order 1992 SI 1992 No. 3123 Art 3(b) (before 1 January 2000) and the Value Added Tax (Input Tax) (Specified Supplies) Order 1999 SI 1999 No. 3121 Art. 3(b)(after 1 January 2000)

Citations:

[2005] UKVAT V19302

Links:

Bailii

Jurisdiction:

England and Wales

VAT

Updated: 04 July 2022; Ref: scu.237990

Atlantic Electronics v HM Revenue and Customs: VDT 20 Sep 2005

VALUE ADDED TAX – ZERO-RATING -supplies of mobile phones to a person in another Member State- International Consignment Notes (CMRs) contained false particulars – unreliable evidence demonstrating actual removal – no other evidence to substantiate removal – Commissioners entitled to conclude that the mobile phones had not been removed -whether domestic legislation compatible with Article 28cA(a) of the Sixth Directive- subject to referral to Court of Justice in Telios – Appeal stood over for final determination pending Court of Justice and High Court decisions in Telios.

Citations:

[2005] UKVAT V19256

Links:

Bailii

Jurisdiction:

England and Wales

VAT

Updated: 04 July 2022; Ref: scu.237962

EMI Group Plc v Revenue and Customs: VDT 9 Jan 2006

VDT CLAIM FOR REPAYMENT OF TAX – VAT paid in error – VAT accounted for in respect of free copies of CDs given out for promotional purposes – Whether free copies were ‘samples’ or ‘business gifts’ – EC Sixth Dir, Art 5.6 – VAT Act 1983, Sch 2, para 5(1), (2), (2A) – VAT Act 1994, Sch 4, para 5(1), (2), (3)
CLAIM FOR REPAYMENT OF TAX – Implementation in UK legislation of provisions of EC Sixth Dir, Art 5.6 – Whether last sentence of Art 5.6 properly implemented in view of restrictive wording in VAT Act 1993, Sch 2, para 5(1), (2), (2A) and VAT Act 1994, Sch 4, para 5(1), (2), (3) – Questions referred to ECJ
CLAIM FOR REPAYMENT OF TAX – VAT paid in error – Time limit for claims – Reduction of time limit from 6 years to 3 years – ECJ held (in Marks and Spencer plc v Customs and Excise Commissioners Case 62/00 [2002] STC 1036 ECJ) that UK legislation incompatible with Community law in failing to provide for a transitional period – Commissioners promulgate details of transitional period and conditions for making claims in Business Briefs 22/02 and 27/02 – Whether in those circumstance UK has complied with judgment in Marks and Spencer – Whether Business Briefs effective to provide required transitional period – Questions referred to ECJ – VAT Act 1994, s 80 as amended by FA 1997,(1)

Citations:

[2006] UKVAT V19417

Links:

Bailii

VAT

Updated: 04 July 2022; Ref: scu.237945

Carr and Another v Revenue and Customs: VDT 30 Sep 2005

VDT REGISTRATION – Intending trader – First Appellant purchasing listed building and restoring – Whether Appellant established intention to make business supply – No – Transfer to second Appellant – Whether transfer of going concern – No because first Appellant not a taxable person – Whether second Appellant established intention to make business supply – No on facts – VATA 1994 s.30(1)(b) Sch 1 para 9(1)(b) Sch 8 Grp 6 item 1 – VAT (Special Provisions) Order 1995 (1985/1268) reg 5 – Appeals dismissed
ZERO-RATING – Protected buildings – Alteration – New damp insulation and drainage system – Work to fabric – Fixing of specialised membrane to inside of external walls with drainage channels – Whether excluded as ‘works of repair and maintenance’ – No – VATA 1994 Sch 8 Grp 6 item 3 Note (6) – Appeal allowed

Citations:

[2005] UKVAT V19267

Links:

Bailii

VAT

Updated: 04 July 2022; Ref: scu.237964

Nicholson v Revenue and Customs: VDT 5 Jan 2006

VDT VAT – refund – conversion of listed and unlisted farm buildings to residential building – whether taxpayer entitled to refund of VAT on conversion of unlisted buildings into part of new building described as annex – appeal allowed – VATA 1994 s 35 (1A)(c), (1D)(a), Sch 8 Group 5 note 2(c )

Citations:

[2006] UKVAT V19412

Links:

Bailii

VAT

Updated: 04 July 2022; Ref: scu.237948

One-on Railway Engineering Ltd v Revenue and Customs: VDT 12 Sep 2005

VAT DEFAULT SURCHARGE – Appellant missed Bank deadline by five minutes to make telegraphic transfer – Appellant did not know about the deadline – Appellant had not made enquiries with bank about its timetable for making telegraphic transfer – no reason advanced for missing the deadline other than lack of knowledge – no reasonable excuse – appeal dismissed

Citations:

[2005] UKVAT V19247

Links:

Bailii

VAT

Updated: 04 July 2022; Ref: scu.237975

Deluni Mobile Ltd v Revenue and Customs: VDT 24 Oct 2005

VDT VALUE ADDED TAX – input tax – dealer in mobile telephones – purchase in UK of goods sold to German trader – whether input tax incurred on purchase recoverable – alleged carousel fraud – whether necessary circularity established – evidence of payment by antecedent dealer to Appellant’s purchaser – whether inference to be drawn of circular or linear fraud – circularity the only reasonable inference – appeal dismissed on facts but final decision stood over pending outcome of reference of Optigen and others to European Court of Justice.

Citations:

[2005] UKVAT V19301

Links:

Bailii

Jurisdiction:

England and Wales

VAT

Updated: 04 July 2022; Ref: scu.237997

Robert Gordon University v Customs and Excise: VDT 22 Sep 2005

VDT Supply of goods and services – Education – supply of staff and other services to subsidiary company who provided services of education to Scottish Ministers in place of Appellant – contract between Appellant and company for staff and other services – whether standard rated or exempt – VATA 1994 Sch 9 Group 6.

Citations:

[2004] UKVAT V19317

Links:

Bailii

VAT

Updated: 04 July 2022; Ref: scu.237979

Peugot Motor Company Plc v Her Majesty’s Revenue and Customs: VDT 20 Sep 2005

VDT VALUE ADDED TAX – car manufacturer offering free or low-interest credit – credit provided by finance company to retail customer – subsidy paid by manufacturer to finance company – whether price reduction within principles established in Elida Gibbs – whether subsidy to be deducted from consideration received by manufacturer for supply of car to dealer – no – subsidy consideration for separate exempt supply – appeal dismissed

Citations:

[2005] UKVAT V19260

Links:

Bailii

VAT

Updated: 04 July 2022; Ref: scu.237977

Scottish Equitable Plc v Revenue and Customs: VDT 11 Jan 2006

VDT Value added tax – claim for deduction of input tax – pension review services supplied – tax paid for services between 1/1/95 and 31/1/98 – subsequent determination that such services exempt – whether tax could be reclaimed, having regard to the provisions of the Finance Act 1997 s.47 and VATA s.80 – no transitional period in legislation – whether legislation unlawful and requires to be disapplied as contrary to community law rights of deduction. Whether previous limitation period remained in force. Appeal allowed.

Judges:

T Gordon Coutts, QC

Citations:

[2006] UKVAT V19418

Links:

Bailii

VAT

Updated: 04 July 2022; Ref: scu.237950

Turn-und Sportunion Waldburg v Finanzlandesdirektion fur Oberosterreich: ECJ 12 Jan 2006

ECJ Sixth VAT Directive – Article 13(B)(b) and (C)(a) – Exemption of leasing and letting of immovable property – Right of option in favour of taxable persons – Non-profit-making sports clubs – Conditions

Citations:

[2006] ECR I-589, [2006] EUECJ C-246/04, [2006] STI 164, [2006] STC 1506

Links:

Bailii

Jurisdiction:

European

VAT

Updated: 04 July 2022; Ref: scu.237653

Optigen Ltd, Fulcrum Electronics Ltd, Bond House Systems Ltd v Commissioners of Customs and Excise: ECJ 12 Jan 2006

ECJ Sixth VAT Directive – Article 2(1), Article 4(1) and (2) and Article 5(1) – Deduction of input tax – Economic activity – Taxable person acting as such – Supply of goods – Transaction forming part of a chain of supply involving a defaulting trader or a trader using an unauthorised VAT number – Carousel fraud.

Citations:

C-484/03, [2006] EUECJ C-484/03, C-355/03, C-354/03

Links:

Bailii

Jurisdiction:

European

Citing:

Adopted – Bond House Systems Ltd v Customs and Excise VDT 8-May-2003
The Tribunal described the general nature of a carousel fraud: ‘In its simplest form a carousel fraud works in this way. A VAT-registered trader, A, in one European Union member state sells taxable goods to a VAT-registered trader, B, in another . .
At VDT – Optigen Ltd v Customs and Excise VDT 1-May-2003
INPUT TAX – carousel fraud – whether transactions must be ignored as not being economic activities with the result that an innocent party is not entitled to credit for input tax – yes – whether the principles of legal certainty, proportionality, . .

Cited by:

See Also – Optigen Ltd, Fulcrum Electronics Ltd, Bond House Systems Ltd v Commissioners of Customs and Excise ECJ 12-Jan-2006
ECJ Sixth VAT Directive – Article 2(1), Article 4(1) and (2) and Article 5(1) – Deduction of input tax – Economic activity – Taxable person acting as such – Supply of goods – Transaction forming part of a chain . .
See Also – Optigen Ltd, Fulcrum Electronics Ltd, Bond House Systems Ltd v Commissioners of Customs and Excise ECJ 12-Jan-2006
ECJ Sixth VAT Directive – Article 2(1), Article 4(1) and (2) and Article 5(1) – Deduction of input tax – Economic activity – Taxable person acting as such – Supply of goods – Transaction forming part of a chain . .
Cited – Total Network Sl v Customs and Excise Commissioners CA 31-Jan-2007
The defendants suspected a carousel VAT fraud. The defendants appealed a finding that there was a viable cause of action alleging a ‘conspiracy where the unlawful means alleged is a common law offence of cheating the public revenue’. The defendants . .
Lists of cited by and citing cases may be incomplete.

VAT

Updated: 04 July 2022; Ref: scu.237648

Centralan Property v Commissioners of Customs and Excise (Taxation): ECJ 15 Dec 2005

ECJ Sixth VAT Directive – Article 20(3) – Capital goods – Deduction of input tax – Adjustments of deductions – Immovable property – Disposal by means of two connected transactions, one exempt, the other taxable – Apportionment.

Citations:

C-63/04, [2005] EUECJ C-63/04

Links:

Bailii

European, VAT

Updated: 04 July 2022; Ref: scu.236389

Cantrell (T/A Foxearth Lodge) v Commissioners Of Customs and Excise: ChD 6 Mar 2003

Exemption was sought from liability for VAT on a new building erected at the taxpayer’s nursing home.
Whether the goods and services supplied to the appellants in the course of the construction of buildings on their property at Woodbridge, Suffolk are zero-rated. The Tribunal held that they were not.

Judges:

The Vice-Chancellor

Citations:

[2003] EWHC 404 (Ch)

Links:

Bailii, Bailii

Statutes:

VAT Act 1994

Jurisdiction:

England and Wales

VAT, Construction

Updated: 04 July 2022; Ref: scu.342130

Levob Verzekeringen and Ov Bank v Staatssecretaris van Financien: ECJ 27 Oct 2005

ECJ Sixth VAT Directive – Articles 2, 5, 6 and 9 – Transfer of software recorded on a carrier – Subsequent customisation of the software to the purchaser-?s specific requirements – Single taxable supply – Supply of services – Place of supply.

Judges:

Jann P

Citations:

C-41/04, [2005] EUECJ C-41/04, [2006] 2 CMLR 8, [2006] STC 766, [2006] CEC 424, [2005] ECR I-9433, [2007] BTC 5186, [2005] STI 1777, [2007] BVC 155

Links:

Bailii

Cited by:

Cited – HM Revenue and Customs v Weight Watchers (UK) Ltd ChD 21-Jan-2008
The court was asked whether the weight-watchers program which included attendance at a course and a supply of supporting materials was one single standard-rated supply or separate supplies of zero-rated printed materials and standard-rated support . .
Cited – Baxendale Ltd and Another v Revenue and Customs FTTTx 4-Jul-2013
FTTTx PROCEDURE – striking out of proceedings – whether appellants’ case had a reasonable prospect of succeeding – abuse of process – whether Court of Appeal decision in David Baxendale was per incuriam or . .
Lists of cited by and citing cases may be incomplete.

European, VAT

Updated: 04 July 2022; Ref: scu.234673

College of Estate Management v Customs and Excise: HL 20 Oct 2005

The college supplied educational services by distance learning. The commissioner sought to argue that printe daterials supplied with the course were ancillary and did not have the same exemption form VAT.
Held: The supplies did benefit from the exemption. The attempt to separate out the supply of prnted course materials was articifial and inconvincing. The court had to decide whether it was a separate supply. Save that it had not been necessary to make a findng that the provision of the materials was ancillary to the supply of educational services, the original decision of the tribual was correct, and should be restored. Appeal courts should be circumspect in overturning assessments made bu first-instance tribunals: ‘Not every nuance of a first-instance tribunal’s assessment of the evidence can be conveyed in its written reasons, however carefully prepared’ (Lord Walker of Gestingthorpe)

Judges:

Lord Walker of Gestingthorpe, Lord Carswell, Lord Steyn, Lord Hutton, Lord Rodger of Earlsferry

Citations:

[2005] UKHL 62, Times 26-Oct-2005, [2005] STC 1597, [2005] 1 WLR 3351, [2005] 4 All ER 933

Links:

Bailii, House of Lords

Statutes:

Council Directive 77/388/EEC

Citing:

Cited – Beynon and Partners v Customs and Excise HL 25-Nov-2004
The House asked whether the personal administration of a drug such as a vaccine by an NHS doctor to a patient is a taxable supply for the purposes of value added tax. The provision of medical care in the exercise of the medical and paramedical . .
Cited – Faaborg-Gelting Linien v Finanzamt Flensburg ECJ 2-May-1996
A non-takeaway restaurant is a supply of services, and a ferry supply was made from its place of business. The supply of prepared food and drink at a restaurant resulted from a whole series of services (including the preparation and service of the . .
Appeal from – College of Estate Management v Commissioners of Customs and Excise CA 11-Aug-2004
When offering courses to distance learning students, the College offered materials for the courses. As part of the course this supply would be exempt, as books, the supply would be zero-rated, but the taxpayer would be able to reclaim its VAT . .
Cited – Commissioners of Customs and Excise v British Telecommunications Plc HL 11-Feb-1999
The cost of the delivery of a quantity of new cars from the factory or depot to the purchaser is incidental and ancillary to the supply of the cars themselves, and the VAT on delivery charges was not reclaimable by the purchasing company as Input . .
Cited – College of Estate Management v Commissioners of Customs and Excise CA 11-Aug-2004
When offering courses to distance learning students, the College offered materials for the courses. As part of the course this supply would be exempt, as books, the supply would be zero-rated, but the taxpayer would be able to reclaim its VAT . .
Cited – Commissioners of Customs and Excise v Madgett and Baldwin (trading as Howden Court Hotel) ECJ 22-Oct-1998
The court considered the criteria for determining whether the provision to guests by a hotelier of travel services (and in particular transport to and from the hotel and excursions) constituted supply which was ancillary to the supply of . .
Tribunal Decision – International Correspondence Schools Limited v Commissioners of Customs and Excise VDT 2002
. .

Cited by:

Cited – HM Revenue and Customs v Weight Watchers (UK) Ltd ChD 21-Jan-2008
The court was asked whether the weight-watchers program which included attendance at a course and a supply of supporting materials was one single standard-rated supply or separate supplies of zero-rated printed materials and standard-rated support . .
Cited – Office of Fair Trading (OFT) v Abbey National Plc and Others SC 25-Nov-2009
The banks appealed against a ruling that the OFT could investigate the fairness or otherwise of their systems for charging bank customers for non-agreed items as excessive relative to the services supplied. The banks said that regulation 6(2) could . .
Lists of cited by and citing cases may be incomplete.

VAT, Education

Updated: 04 July 2022; Ref: scu.231237

CMS Peripherals Ltd v Revenue and Customs: VDT 8 Aug 2005

VDT VALUE ADDED TAX – three default surcharge – finance director of Appellant perpetrated large scale and complex fraud against the Appellant – the effect of the fraud was to reduce the cash flow of the Appellant and to reduce its profits – whether the Appellant had a reasonable excuse for each of the defaults – yes – appeal allowed – VATA 1994 Ss 59A(8)(a)(ii) and 71(1)

Citations:

[2005] UKVAT V19234

Links:

Bailii

Jurisdiction:

England and Wales

VAT

Updated: 04 July 2022; Ref: scu.230184

Warren (T/A Sports Network Europe) v Revenue and Customs: VDT 8 Aug 2005

VDT INPUT TAX – Exclusion of credit for input tax – Business entertainment – Taxpayer’s business is promoting boxing matches – Taxpayer obtaining licence of box at Arsenal football ground – Taxpayer conducting business meetings at box on occasions of football matches – Whether box used for ‘business entertainment’ – Value Added Tax (Special Provisions) Order 1992 (SI 1992 No.3222) Art 5

Citations:

[2005] UKVAT V19213

Links:

Bailii

Jurisdiction:

England and Wales

VAT

Updated: 04 July 2022; Ref: scu.230202

Newman College In the University of Cambridge v Customs and Excise: VDT 14 Feb 2005

VDT Landlord Property – Construction and renovation of library by College – Irrecoverable VAT – Lease of library to subsidiary company – Election to waive election – Arrangements for subsidiary company to provide library services to College – Whether election to waive exemption disapplied under Sch 10, para 2(3AA) VATA 1999 – Yes – Whether tax mitigation scheme not in accordance with Sixth Directive – yes – Appeal dismissed

Citations:

[2005] STI 816, [2005] BVC 2374, [2005] V and DR 36, [2005] UKVAT V18936

Links:

Bailii, Bailii

VAT, Construction

Updated: 04 July 2022; Ref: scu.230214

Skelton Transport Group Plc v Revenue and Customs: VDT 20 Jul 2005

VDT VAT – PENALTIES -default surcharges – agreement by taxpayer with Customs for payment of arrears of VAT on terms that taxpayer would pay future tax on time and be liable for pre-existing and future default surcharges – held that in consequence no reasonable excuse existed for avoiding liability for surcharges under appeal – appeal dismissed

Citations:

[2005] UKVAT V19239

Links:

Bailii

VAT

Updated: 04 July 2022; Ref: scu.230178

Ace Telecom Ltd v Revenue and Customs: VDT 19 Aug 2005

VDT VAT – application for registration by company dealing in mobile telephones – refusal of respondents to register applicant under future turnover rule in para 1(1)(b) Schedule 1 VATA 1994 – appellant effectively prevented from trading by respondents – alternatively respondents refused registration under para 9 Schedule 1 – refusal based on alleged absence of evidence of trading and objective intention to trade – finding that objective evidence provided – appeal allowed

Citations:

[2005] UKVAT V19214

Links:

Bailii

VAT

Updated: 04 July 2022; Ref: scu.230179

Hopcraft v Revenue and Customs: VDT 26 Jul 2005

VDT VALUE ADDED TAX – ASSESSMENT – validity – whether for a prescribed accounting period – Hindle considered – yes – assessment valid.
VALUE ADDED TAX – TRIBUNAL – jurisdiction to raise issues of its own motion.

Citations:

[2005] UKVAT V19220

Links:

Bailii

Jurisdiction:

England and Wales

VAT

Updated: 04 July 2022; Ref: scu.230175

Shomar Uddin/Greenleaf (Lothian) Ltd (T/A Eastern Eye) v Revenue and Customs: VDT 1 Jun 2005

VDT Assessment – restaurant business founded by A in 1996 – taken over as going concern by B Ltd – A not a director – but became company secretary after lapse of time – dishonesty – invigilation – calculation and assessment from 1996. Period restricted to the time of operation of company – and assessment reduced accordingly.
Whether to best judgement – allegations about conduct of Customs officers in general and in particular – rejected.
Penalty – proved dishonesty of A at the time of a particular invigilation – extent of time in which A had engaged in dishonest conduct – no evidence before company formation: penalty restricted.

Judges:

T Gordon Coutts, QC

Citations:

[2005] UKVAT V19135

Links:

Bailii

VAT

Updated: 04 July 2022; Ref: scu.230173

SK Souliman (T/A Byzantium Restaurant) v Revenue and Customs: VDT 2 Aug 2005

VDT Assessment; restaurant; suppression of takings; quantum of assessment; evidence of observations on one Wednesday and one Saturday; no suppression on Wednesday found; significant suppression on Saturday found; whether inference of suppression over whole period of trading could be drawn from one night’s observations; no; whether inference of suppression on Saturdays could be drawn; yes; assessment to be reduced in accordance with Findings of the Tribunal; Value Added Tax 1994 section 73(1).

Citations:

[2005] UKVAT V19200

Links:

Bailii

VAT

Updated: 03 July 2022; Ref: scu.229640

Willis Pension Trustees Ltd v Revenue and Customs: VDT 25 Jul 2005

VDT Supply for a consideration – whether foreign exchange transactions always constitute such supplies by both parties – whether a counterparty’s profit from foreign exchange transactions is consideration for its supply – Value Added Tax Act 1994 section 5(2) – Sixth Directive Articles 2 and 11. Interpretation of the operative part of a preliminary ruling by the ECJ.

Citations:

[2005] UKVAT V19183

Links:

Bailii

VAT, European

Updated: 03 July 2022; Ref: scu.229635

Kane v Revenue and Customs: VDT 26 Jul 2005

VDT VAT – massage parlour – whether supplies made to masseuses standard-rated supply of facilities or exempt supply of licence to occupy rooms – on facts held standard-rated supply of facilities – appeal dismissed

Citations:

[2005] UKVAT V19193

Links:

Bailii

VAT

Updated: 03 July 2022; Ref: scu.229620

Uniq Group Plc v Customs and Excise: VDT 16 Jun 2005

VDT VAT – SUPPLY OF GOODS – SINGLE OR MULTIPLE -‘Dippin’ Fingers’ consisting of chocolate finger biscuits and chocolate mousse – table top supply with mousse predominate – zero-rated – No – two separate supplies – chocolate fingers standard rated – mousse zero-rated – Appeal dismissed – Card Protection Plan applied.

Citations:

[2005] UKVAT V19125

Links:

Bailii

VAT

Updated: 03 July 2022; Ref: scu.229604

Sparkholme Ltd (T/A Top Class Sauna) v Revenue and Customs: VDT 28 Jul 2005

VDT OUTPUT TAX – Computation – Sauna and massage business – Masseuses working at Appellant’s premises are paid cash direct by customers – Masseuses pay part to Appellant – Whether Appellant’s outputs include the full amount of receipts of masseuses – Yes – Appeal dismissed

Citations:

[2005] UKVAT V19187

Links:

Bailii

Jurisdiction:

England and Wales

VAT

Updated: 03 July 2022; Ref: scu.229631

Langstane Housing Association Ltd v Revenue and Customs: VDT 8 Jun 2005

VDT Value Added Tax – sale of commercial building to housing association for conversion into residential flats – ‘option to tax’ having been exercised by seller – whether purchaser can restore exemption by retrospective certificate – VATA 1994, Schedule 10, Paragraph 2(1) and (3) and Schedule 8, Group 5, Note (12) – Appeal refused.

Citations:

[2005] UKVAT V19111

Links:

Bailii

VAT

Updated: 03 July 2022; Ref: scu.229578

Smith v Revenue and Customs: VDT 9 Jun 2005

VDT VALUE ADDED TAX – partially exempt trader – failure to make correct partial exemption calculation – errors due to misunderstanding – under-declared tax agreed and paid – trader disputing assessment for interest and imposition of misdeclaration penalty – interest no more than commercial restoration – penalty properly imposed – no reasonable excuse but mitigation to five per cent appropriate – appeal allowed only to that extent

Citations:

[2005] UKVAT V19113

Links:

Bailii

Jurisdiction:

England and Wales

VAT

Updated: 03 July 2022; Ref: scu.229599

Marden Management Ltd v Revenue and Customs: VDT 30 Jun 2005

VDT DEFAULT SURCHARGE – Reasonable excuse – Late payment – Unexpected illness of sole cheque signatory – Appellant claimed to be unaware of availability to it of BACS and CHAPS facilities for making payment within extended period – Whether reasonable excuse – No – Appeal dismissed

Citations:

[2005] UKVAT V19147

Links:

Bailii

Jurisdiction:

England and Wales

VAT

Updated: 03 July 2022; Ref: scu.229579

Coleman v Revenue and Customs: VDT 20 Jun 2005

VDT INPUT TAX-Purchase of motor vehicle-Vehicle intended and in fact used for business purposes only-Insured for business and private use-Business only policy not available-Sole proprietor of business-Keys of vehicle kept locked in desk in locked office-Whether vehicle ‘available for private use’-Yes-VAT (Input Tax) Order 1992, art 7(1)(a), 7(2E)(a), 7(2G)(b)

Citations:

[2005] UKVAT V19132

Links:

Bailii

Statutes:

VAT (Input Tax) Order 1992

VAT

Updated: 03 July 2022; Ref: scu.229568

United Utilities Plc v Commissioners of Customs and Excise: CA 8 Mar 2004

The taxpayer offered telephone gambling services through a local agent who did not accept money or set any odds.
Held: The services of the agents were administrative only, and not gambling services. There could be no principle to say that a supplier to an exempt business attracted the same exemption. The agent’s services were taxable.

Judges:

Lord Justice Auld Lady Justice Arden Lord Justice Jacob

Citations:

[2004] EWCA Civ 245, Gazette 01-Apr-2004

Links:

Bailii

Statutes:

Council Directive 77/388/EEC

Jurisdiction:

England and Wales

Citing:

Appeal from – United Utilities Plc v Commissioners of Customs and Excise ChD 2002
Agents supplied facilities used for a telephone betting company. The services did not include the taking of any money or the settling of odds or otherwise.
Held: The services were not exempt. . .

Cited by:

Appealed to – United Utilities Plc v Commissioners of Customs and Excise ChD 2002
Agents supplied facilities used for a telephone betting company. The services did not include the taking of any money or the settling of odds or otherwise.
Held: The services were not exempt. . .
Lists of cited by and citing cases may be incomplete.

VAT

Updated: 03 July 2022; Ref: scu.194328

Revenue and Customs v Fortyseven Park Street Ltd: CA 17 May 2019

Treatment for value added tax VAT purposes of sums that the respondent, Fortyseven Park Street Limited, has received from selling ‘Fractional Interests’ relating to a property at 47 Park Street in London’s Mayfair.

Judges:

Lord Justice Newey

Citations:

[2019] EWCA Civ 849

Links:

Bailii

Jurisdiction:

England and Wales

VAT, Land

Updated: 03 July 2022; Ref: scu.637522

Calltel Telecom Ltd and Another v Revenue and Customs: ChD 6 Jun 2008

Citations:

[2008] EWHC 2107 (Ch)

Links:

Bailii

Jurisdiction:

England and Wales

Cited by:

See Also – Calltel Telecom Ltd and Another v HM Revenue and Customs ChD 21-May-2009
Appeal against decisions by HMRC to refuse repayment of input tax in respect of claims made for that purpose – allegation of knowledge of fraudulent element elsewhere in supply chain. . .
See Also – Mobilx Ltd and Others v HM Revenue and Customs; Blue Sphere Global Ltd v Same and similar CA 12-May-2010
Each company sought repayment of input VAT. HMRC refused, saying that the transactions were the end-product of a fraud on it, and that even if the taxpayer did not know that a fraud was involved, it should have been aware that one was and acted . .
Lists of cited by and citing cases may be incomplete.

VAT

Updated: 01 July 2022; Ref: scu.341725

Kohler (Judgment): ECJ 15 Sep 2005

ECJ Sixth VAT Directive – Place of taxable transactions – Supplies of goods effected on board cruise ships – Transport effected within the Community – Exclusion of tax where a stop is made in a third territory – Scope of the exclusion.

Citations:

C-58/04

Jurisdiction:

European

European, VAT

Updated: 01 July 2022; Ref: scu.230323

Revenue and Customs v Jacobs: CA 22 Jul 2005

The taxpayer had converted a former residentional boarding school into a substantial private residence. He had sought to claim over andpound;300,000 VAT inputs. The Commissioners appealed the finding that he was so entitled.
Held: ‘works constitute a residential conversion to the. extent only that they consist in the conversion of a non-residential (part of a) building. If and to the extent that the works consist in the conversion of what is not non-residential, then those works are outside the scope of the subsection. A conversion qualifies not only when converting the whole of a non-residential building but also when converting a non-residential part of the building. If part is non-residential the other part must be treated as Residential, i.e., not non-residential. A conversion qualifies if it has anyone of three results namely a building designed as a dwelling or a number of dwellings, or a building intended for use solely for a residential purpose or anything which would fall within the above if different parts of a building were treated as separate buildings. The part of the building likewise has to be converted into a building designed as a dwelling or number of dwellings. The decision of the Tribunal was re-instated.

Citations:

[2005] EWCA Civ 930

Links:

Bailii

Jurisdiction:

England and Wales

Citing:

At VAT Tribunal – Jacobs v Customs and Excise VDT 13-Feb-2004
A developer sought to set off input taxes paid in the redevelopment of a former residential boarding school as a family home.
Held: The taxpayer’s appeal succeeded. . .
Appeal from – Commissioners of Customs and Excise v Jacobs ChD 22-Oct-2004
. .
Cited – Commission v United Kingdom ECJ 21-Jun-1988
Europa An action by the Commission pursuant to Article 169 of the Treaty against a Member State for failure to fulfil its obligations, the bringing of which is a matter for the Commission in its entire . .
Cited – Commission v Finlande ECJ 15-Jul-2004
Europa Failure of a Member State to fulfil obligations – Directive 77/388/EEC – VAT – Article 11(A)(1)(a) – Taxable amount – Subsidy directly linked to the price – Regulation (EC) No 603/95 – Aid granted in the . .
Cited – Commissioners of Customs and Excise v Blom-Cooper ChD 12-Jul-2002
The tax payer had converted a building which had had both residential and business uses into residential use, and sought to reclaim the input tax on that part of the expenditure attributable to the residential part. The Commissioners appealed.
Cited – Commissioners of Customs and Excise v Blom-Cooper CA 4-Apr-2003
The taxpayer appealed a decision that a conversion of a non-residential part of a building used for business and residential purposes was not exempt from VAT.
Held: The building was not within the definition of a self contained residential . .
Lists of cited by and citing cases may be incomplete.

VAT

Updated: 01 July 2022; Ref: scu.228995

Bournemouth Symphony Orchestra v Customs and Excise: ChD 21 Jul 2005

The Orchestra claimed exemption from VAT as a voluntary body supplying cultural services. The respondent argued that since the administrator was paid, the body was not voluntary.
Held: The board operated as would a commercial company. All members were voluntary save the managing director who was paid. Where the remuneration of a board member was not linked to the operating profit of the company, the fact that he was paid would not take the company outside the exemption, since he would not have an interest in the profits. However, the tribunal should have continued to consider whether the management of the company remained essentially voluntary. That was a question of fact for each case. In this case the managing director’s substantial responsibility meant the the board was no longer essentially voluntary, and the Board had lost its exemption.

Citations:

[2005] EWHC 1566 (Ch), Times 06-Sep-2005

Links:

Bailii

Statutes:

Directive 77/388/EC 813, Value Added Tax Act 1994 SCh9

Jurisdiction:

England and Wales

Citing:

Cited – Kennemer Golf and Country Club v Staatssecretaris van Financien, Zoological Society of London v Commissioners of Customs and Excise Case ECJ 21-Mar-2002
The bodies sought exemption from certain elements of VAT as ‘non-profit’ making or ‘voluntary’ bodies. Their activities included trading activities, but they did not set out to make a profit overall.
Held: For certain exemptions, the term . .
Appeal from – Bournemouth Symphony Orchestra v Customs and Excise VDT 15-Oct-2004
The Bournemouth Symphony Orchestra (‘BSO’) did not benefit from an exemption from VAT provided by Article 13A(1)(n) of the Sixth Directive and by the Valued Added Tax Act 1994 Schedule 9 Group 13. The BSO was not ‘managed and administered on an . .

Cited by:

Appeal from – Bournemouth Symphony Orchestra v Revenue and Customs CA 9-Oct-2006
The Orchestra apealed a finding that it was not entitled to exemption from VAT as a supply by an eligible body of a cultural performance. The taxpayer’s board was voluntary, but the management was employed.
Held: The appeal failed. In order to . .
Lists of cited by and citing cases may be incomplete.

VAT, Charity

Updated: 01 July 2022; Ref: scu.228965

Hostgilt Limited v Megahart Limited: 4 Dec 1998

VAT operates with a system of inputs and outputs to bring down the burden of purchase tax. VAT is a tax on a retailer’s turnover, which purchase tax was not. In a concluded contract the question of whether a sum includes VAT is a matter of construction of the agreement.
Miss Hazel Williamson QC said: ‘There is a policy described as ‘fiscal neutrality’ along the line of supply. As long as a party is making taxable supplies it can set off the tax it pays on any input into its business against the tax which it charges on any output. It can either pay the difference to, or reclaim the difference from, Customs and Excise. The only person who eventually gets fixed without any potential set off is the end consumer who is not making taxable supplies. This can be a party not making supplies at all or a party making exempt supplies, or, complicatedly, partially exempt supplies, a situation which applies in the areas of financial services, banking and the insurance industries. To anyone making taxable supplies, the imposition of VAT is irrelevant; to anyone not doing so, it is an expense such that the taking of supplies under a VATable transaction creates additional cost and makes the supply consequently more expensive.’

Judges:

Miss Hazel Williamson QC

Citations:

[1999] STC 141, (1997) 77 PandCR D34, [1999] BTC 5057, [1999] BVC 78

Links:

Bailii

Jurisdiction:

England and Wales

Cited by:

Cited – Debenhams Retail Plc and Another v Sun Alliance and London Assurance Company Ltd CA 20-Jul-2005
The landlord appealed against a decision that VAT was not to be included when calculating a rent based upon the turnover in the premises, when it had been expressed to include purchase taxes.
Held: The appeal succeeded: ‘it would be wrong to . .
Cited – Mason v Boscawen ChD 18-Dec-2008
The landlord had opted to charge VAT on part of the rent. The tenant fell into arrears and now challenged a notice to quit which included the VAT. The court was asked what constituted ‘rent’ for the purposes of a demand for rent founding a notice to . .
Lists of cited by and citing cases may be incomplete.

VAT

Updated: 01 July 2022; Ref: scu.228927

Debenhams Retail Plc and Another v Sun Alliance and London Assurance Company Ltd: CA 20 Jul 2005

The landlord appealed against a decision that VAT was not to be included when calculating a rent based upon the turnover in the premises, when it had been expressed to include purchase taxes.
Held: The appeal succeeded: ‘it would be wrong to treat the differences between the incidence and operation of purchase tax and of VAT as relevant under . . the lease. One system replaced the other, with almost identical impact on final consumer expenditure and on the total received by Debenhams. On Debenhams’ current case, the introduction of VAT would potentially have given them an uncovenanted bonus; instead of the rent being calculated by reference to a turnover amount including (in effect) purchase tax, it should, as from the moment when VAT replaced purchase tax, have been calculated by reference to a lesser net amount, even though the total paid by consumers to and received by Debenhams was effectively the same under both systems. ‘

Judges:

Judge, Mance, Jacob LJJ

Citations:

[2005] EWCA Civ 868, Times 29-Sep-2005, [2006] 1 P and C R 123

Links:

Bailii

Jurisdiction:

England and Wales

Citing:

Cited – Lynn v Nathanson 1931
(Nova Scotia Court of Appeal) A government theatre tax had to be paid by patrons who bought two tickets, one for the theatre and one for the tax. The tax was held to be outside the phrase in the lease which recovered rent on ‘gross receipts obtained . .
Cited – Kirin-Amgen Inc and others v Hoechst Marion Roussel Limited and others etc HL 21-Oct-2004
The claims arose in connection with the validity and alleged infringement of a European Patent on erythropoietin (‘EPO’).
Held: ‘Construction is objective in the sense that it is concerned with what a reasonable person to whom the utterance . .
Cited – Hostgilt Limited v Megahart Limited 4-Dec-1998
VAT operates with a system of inputs and outputs to bring down the burden of purchase tax. VAT is a tax on a retailer’s turnover, which purchase tax was not. In a concluded contract the question of whether a sum includes VAT is a matter of . .
Appeal from – Debenhams Retail plc and Another v Sun Alliance and Londoin Insurance Company Ltd ChD 9-Nov-2004
The lease contained a clause where the rent was to be set according to the ‘gross amount of the total sales’ of the tenant. The tenant argued that this figure did not include the VAT charged on sales, the landlord argued that it was the total sums . .

Cited by:

Cited – Lloyds TSB Foundation for Scotland v Lloyds Banking Group Plc SC 23-Jan-2013
A predecessor bank had created a trust into which it paid a small proportion of its profits. The parties now disputed the calculation of profits when the Bank declared a loss which allowed for an unrealised gain on the acquisition of HBOS. . .
Lists of cited by and citing cases may be incomplete.

Landlord and Tenant, VAT

Updated: 01 July 2022; Ref: scu.228921

Revenue and Customs v Debenhams Retail Plc: CA 18 Jul 2005

The store introduced a system whereby when a customer paid by credit card, the charges made to them for card handling were expressed as a separate amount on the receipt. The store then said that VAT was payable only on the net amount allocated to the goods purchased.
Held: The till slip was insufficent to establish in the customer’s mind that he was taking two services, or to create a second contract. The store’s claim failed, and the Commissioners’ appeal succeeded. Given this analysis the question of abuse did not arise.

Judges:

Lord Justice Mummery Lord Justice Mance Sir Peter Gibson

Citations:

[2005] EWCA Civ 892, Times 26-Jul-2005

Links:

Bailii

Jurisdiction:

England and Wales

Citing:

Cited – Apple and Pear Development Council v Commissioners of Customs and Excise ECJ 8-Mar-1988
Consideration means ‘everything received in return for the supply of services or the provision of services’. . .
Cited – Telewest Communications Plc Telewest (Publications) Limited v Commissioners of Customs and Excise CA 10-Feb-2005
The taxpayers sold cable services which were liable to VAT through 28 subsidiaries, and supplied by a third party as part of the same service a listings magazine. They sought exemption from VAT for that part of the consideration related to the . .
Cited – Trafalgar Tours Ltd v Customs and Excise Commissioners CA 1990
United Kingdom legislation is to be construed so far as possible so as to give effect to the purpose(s) of the European directives. As to the meaining of ‘consideration’ under the Sixth Directive: ‘Having regard to art 11A(1)(a) of the Sixth . .
Appeal from – Debenhams Retail Plc v The Commissioners of Customs and Excise ChD 1-Jul-2004
. .
Cited – Halifax plc v Commissioners of Customs and Excise VDT 2001
. .
Cited – Customs and Excise Commissioners v Reed Personal Services Ltd 1995
The court consideerd the basic nature of Value Added Tax (VAT): ‘First, . . .. the concept of supply for the purposes of VAT is not identical with that of contractual obligation. Secondly, in consequence, it is perfectly possible that although the . .
Cited – Kuwait Petroleum (GB) Ltd v Commissioners of Customs and Excise ECJ 27-Apr-1999
‘Items’ described as gifts’ which Kuwait Petroleum exchanged under a petrol promotion scheme for vouchers received by customers purchasing petrol were issued ‘free of charge’. The purchase of petrol and the exchange of vouchers for gifts were . .
Cited – Tesco Plc v Customs and Excise Commissioners CA 14-Oct-2003
The taxpayer had a loyalty scheme under which they issued vouchers to shoppers who had purchased goods to a certain value. They sought to deduct the sums when accounting for VAT.
Held: Upon earning 150 loyalty points in a quarter, vouchers . .
Cited – Auto Lease Holland BV v Bundesamt fur Finanzen ECJ 6-Feb-2003
The court identified the need to give an autonomous meaning to the phrase ‘supply of goods’ in article 5(1) of the Sixth Directive as follows: ‘ . . .. it is clear from the wording of that provision that ‘supply of goods’ does not refer to the . .
Cited – Staatsecretaris Van Financien v Cooperatieve Aardappelenbewaarplaats ECJ 5-Feb-1981
(The Dutch Potato case) A farmers’ cooperative owned a refrigerated potato store. During 1975 and 1976 it came to be unnecessary, because it was planning to sell the store, to levy the usual storage charges on its members. Dutch tax officials . .
Cited – Mirror Group plc v Commissioners of Customs and Excise, Cantor Fitzgerald International v Same ECJ 9-Oct-2001
A potential lessee who did not have an interest in immovable property agreed to take a lease in return for money paid by the landlord. The transaction was not exempt from value-added tax under article 13(B)(b) as ‘the leasing or letting of immovable . .
Cited – Yorkshire Co-operatives Ltd v Commissioners of Customs and Excise ECJ 16-Jan-2003
The retailer accepted coupons issued through newspapers against part of the purchase price of goods. The discount was recovered from the manufacturers on surrender of the coupons. They paid VAT on the discounted value, relying upon Gibbs. The . .
Cited – Town and County Factors Ltd v Customs and Excise Commissioners ECJ 17-Sep-2002
The necessary link between a supply and any consideration for it need not derive from a relationship enforceable in legal proceedings before VAT is chargeable: ‘All that need be examined is whether the components of reciprocal performance are . .
Cited – Primback Ltd v Commissioners of Customs and Excise ECJ 15-May-2001
A company made arrangements for finance for its customers to purchase products at an apparent zero rate of interest. In fact the finance company deducted an undisclosed commission before forwarding payment to the shop. The shop wanted to pay VAT . .
Cited – Lex Services plc v Her Majestys Commissioners of Customs and Excise HL 4-Dec-2003
When taking a car in part exchange, the company would initially offer the correct market value. If the customer wanted, the company would agree a higher price. When cars were returned, the company at first reclaimed the VAT on the re-purchase price, . .
Cited – Interfoto Picture Library Ltd v Stiletto Visual Programmes Ltd CA 12-Nov-1987
Incorporation of Onerous Terms Requires More Care
Photographic transparencies were hired out to the advertising agency defendant. The contract clauses on the delivery note included a fee which was exorbitant for the retention of transparencies beyond the set date.
Held: The plaintiff had not . .
Cited – In re Charge Card Services Ltd ChD 1987
The court discussed the historic availability of set-off in an insolvency: ‘By the turn of the [20th] century, therefore, the authorities showed that debts whose existence and amount were alike contingent at the date of the receiving order, and . .
Cited – Customs and Excise Commissioners v Diner’s Club Ltd CA 1989
Where a payment is made by credit card, some form of underlying contractual scheme will pre-date any individual contract of sale. This may include not merely the contract between the card-holder and card-issuer, but also an arrangement between the . .
Cited – Sa Chaussure Bally v Ministry of Finance Belgium ECJ 20-Sep-1993
The Vatable amount is based on what a purchaser pays ignoring any commissions. . .
Cited – Emsland-Starke GmbH v Hauptzollamt Hamburg-Jonas ECJ 14-Dec-2000
ECJ Articles 9(1), 10(1) and 20(2) to (6) of Regulation No 2730/79 laying down common detailed rules for the application of the system of export refunds on agricultural products, in the version resulting from . .
Cited – Telewest Communications Plc Telewest (Publications) Limited v Commissioners of Customs and Excise CA 10-Feb-2005
The taxpayers sold cable services which were liable to VAT through 28 subsidiaries, and supplied by a third party as part of the same service a listings magazine. They sought exemption from VAT for that part of the consideration related to the . .
Cited – C R Smith Glaziers (Dunfermline) Limited v Commissioners of Customs and Excise HL 20-Feb-2003
The taxpayer sold double glazing, supported by an insured guarantee, for which a charge was made. The additional charge was exempt, but it was contended that the contract should have stated the amount pursuant to Note 5.
Held: The contract . .
Cited – Emsland-Starke GmbH v Hauptzollamt Hamburg-Jonas ECJ 14-Dec-2000
ECJ Articles 9(1), 10(1) and 20(2) to (6) of Regulation No 2730/79 laying down common detailed rules for the application of the system of export refunds on agricultural products, in the version resulting from . .
Lists of cited by and citing cases may be incomplete.

VAT

Updated: 01 July 2022; Ref: scu.228797

Longborough Festival Opera v Customs and Excise: VDT 26 May 2005

VDT EXEMPTION – Cultural services – Eligible body- Preclusion from distributing profits – Management and administration on voluntary basis by persons with no financial interest in the body’s activities – Appellant company limited by guarantee having four ‘trustees’- Trustee undertaking to guarantee losses of Appellant – Same trustee making loans to Appellant – Same trustee owning premises in which Appellant stages operatic productions – Same trustee sole director and majority share holder of commercial company which had financial dealings with Appellant – Whether Appellant managed and administered on voluntary basis by person with no financial interest in its activities – No – EC Sixth Dir, Art 13A.2(a) – VATA 1994, Sch 9, Gp 13, Item 2(b), Note (2)

Citations:

[2005] UKVAT V19096

Links:

Bailii

Cited by:

Appeal from – Longborough Festival Opera v HM Revenue and Customs ChD 27-Jan-2006
The charitable company sought tax exemption as an eligible body supplying music of a cultural nature.
Held: the company’s artciles prohibited distribution of profits, and the management as by directors having no financial interest. . .
Lists of cited by and citing cases may be incomplete.

VAT, Charity

Updated: 01 July 2022; Ref: scu.228548