Judicial review challenge in Vacation Rentals

Judicial review success in a VAT case reveals HMRC’s surprising willingness to resile from its guidance.

One can almost hear the sound of rejoicing at the news that a judicial review action concerning VAT, and effective misdirection by HMRC, has met with success. It takes a brave litigant to embark on such a project, in which the prognosis is almost never good. But Vacation Rentals (UK) Ltd went to the Upper Tribunal ([2018] UKUT 383), in which Judges Fancourt and Herrington supported their case. Their bravery may yet prove unrewarded if HMRC appeals successfully, but we are up and running with a good result that will stiffen taxpayers’ resolve in similar cases.

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Church Annexe – HMRC tries to turn up the heat

Churches and temples are some of the most frequent benefiters from the VAT relief that applies to charity annexes to be used for relevant charitable purposes.  They often erect new structures, but these are, for convenience or economy, commonly attached and linked to an existing building, rather than being physically separate.  But it is far from straightforward to determine when such a development qualifies as an annexe, as distinct from simple extension or enlargement (which are not relieved).  To read more, click here

VAT on Supporting People Programme – YMCA case

Four English YMCAs have come together to appeal a decision on the VAT treatment of their funding from local authorities under the Supporting People scheme.  Unfortunately, they have lost in the First Tier Tribunal (YMCA Birmingham & Ors v Revenue & Customs [2018] UKFTT 458).  It is reasonable to assume that other YMCAs, and similar bodies, will feel the effects of the decision.

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Exempt Charity Fundraisers: the Loughborough Students Union case

Although the decision of the First tier Tribunal in this case (Loughborough Students Union & Ors v HMRC [2018] UKFTT 357 (TC)) seems to relate to the specific world of students unions, and was decided very much on the facts pertaining to such an establishment, nevertheless some general points for the wider charitable world appear to emerge and can be used with caution.

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Summit Electrical: zero-rating of student accommodation

HMRC seeks surrealist escape from its everyday worries.

Given the uncontested view that HMRC faces huge burdens, occasioned by Brexit, making tax digital and other ‘flagship’ projects, one can be forgiven for expecting HMRC to withdraw from all but the most necessary effort in protecting the tax base. But any faith I may have had in that view was torpedoed by reading HMRC’s Upper Tribunal appeal against Summit Electrical Installations [2018] UKUT 176.

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New Edition: VAT Registration – Unravelling the Complexities

The topic of VAT registration may seem very straightforward, but in reality it can be contentious and difficult.

This concise book (click on link below) deserves a place on the shelf of every business tax adviser. In offering an array of practical advice in relation to VAT registration issues as such, the book also covers a range of related VAT topics, and will quickly earn its keep by saving research time and helping to avoid VAT pitfalls.

Topics covered include registration criteria; pros and cons of voluntary registration; supplies, including hidden supplies; “business” and “economic activity”; agent or principal, profit or consideration; business fragmentation, groups; de-registering; penalties and paperwork. This new edition also includes a chapter on the flat rate scheme (as significantly amended in 2017).

“An excellent, practical summary of VAT registration issues.” – AccountingWeb review of first edition

New Edition: VAT Registration – Unravelling the Complexities