Appeal of Wynn Realisations Ltd from an order dismissing the claim of Wynn to 107,250 pounds as being part of the price due but unpaid on the sale of certain land by Wynn to the defendant Vogue Holdings Incorporated. The sum represented the VAT element, the contract expressing the purchase price to be exclusive of VAT. Held; The appeal succeed, and the sum representing VAT was payable. The parties considered that no VAT would be payable or that it could only be payable if the option to tax were taken, but the reason VAT is payable has nothing do with whether or not Wynn opted to tax.
Morritt LJ said: ‘First, VAT, where payable, is charged by reference to the value of the supply which, when in money, is to be taken to be such amount as with the addition of the VAT is equal to the consideration: the price is VAT inclusive. This is apparent from section 19(2) of the 1994 Act. It is for that reason that where VAT is not to be included, the parties normally makes express reference to the fact that the price does not include VAT by reference to a number of formulae, of which ‘exclusive of VAT’ is perhaps the most common.’
Judges:
Morritt, Auld, Clarke LJJ
Citations:
[1999] STC 524, [1999] EWCA Civ 1087, [1999] BTC 5224, [1999] BVC 245
Links:
Jurisdiction:
England and Wales
Cited by:
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.
Land, VAT
Updated: 05 December 2022; Ref: scu.146002