Motor traders gave customers a voucher to be set off against the cost of a replacement car and other services.
Held: Patten J said: ‘The Purchase Plus allowance is negotiated and agreed as a reduction by Hartwell in the amount which the customer will have to pay for the replacement car. No consideration is given for it. It is simply a concession made by the salesman as an inducement to the customer to purchase . . the use of the Purchase Plus Discount Note effectively as part payment of the balance of the purchase price is no different from the use of the coupons or vouchers which were considered in the Boots and the Elida Gibbs cases’.
Judges:
Patten J
Citations:
[2002] STC 22
Jurisdiction:
England and Wales
Cited by:
Appeal from – Commissioners of Customs and Excise v Hartwell Plc CA 12-Feb-2003
The taxpayers were motor traders. On agreeing a sale package with a customer, they issued to the customer a voucher worth more than the agreed trade-in value, to be used as credit against the purchase from the taxpayer. They also gave customers MOT . .
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, . .
Lists of cited by and citing cases may be incomplete.
VAT
Updated: 29 April 2022; Ref: scu.194835