Including VAT Chatter Newsletter
In a judgement issued on 29 July, the court said taxpayers can deduct VAT incurred in purchasing the rights to a subsidy, in this case entitlements to Single Farm Payments (SFPs).
HMRC had refused to allow the farmer, Frank A Smart & Son Ltd (FASL), to deduct VAT of £1,054,852 in its returns between December 2008 and June 2012, arguing that the subsidy was unrelated to the creation of non-exempt supplies. FASL appealed to the First Tier Tribunal (FTT) which ruled in its favour, finding that FASL intended when it purchased the entitlements to use the income from them to pay off its overdraft and develop the business. To read more – click here
In the wake of the court decisions in Longridge and Wakefield College we were wondering where the newly stricter conditions for defining ‘relevant charitable purpose’ left children’s care charities that had relied on the ancient precedents of Yarburgh and St Paul’s. HMRC did not withdraw their policy to the effect that such ‘creche’ charities could be regarded as carrying out relevant charitable purposes despite making charges, but this no longer appeared to align with the recent decisions, and the basic tenet on which they were based, the concept of ‘predominant concern’, had been clearly superseded. We awaited the next step… read more: click here
The Court of Justice of the EU (CJEU) has given what may prove to be the last binding decision on the UK regarding a case the UK courts have referred… read more: click here
Cheshire Centre for Independent Living (‘the charity’) has been involved in a long-running dispute with HMRC over the VAT treatment of charges made to disabled persons in running a payroll service. The scenario arises as follows.
A disabled person may need a carer. Where possible… To read more…
The wider application of Sch 10 ‘clawback’ provisions to lease back financing deals.
As you read this piece the UK may already have left the EU, though it hadn’t at the time of writing. The accepted position is that all CJEU decisions pre-dating that departure date become binding decisions at Supreme Court level. We therefore need to pay heed to the dates of decisions. The CJEU’s decision in Mydibel (Case C-201/18) makes the cut, so to speak, and would have done so by two days even had the UK left as planned on 29 March. It is therefore binding precedent.
And it has something direct to tell us… read more here
A subject that never seems to go away is the issue of how much VAT can be claimed on charity purchases. Quite apart from the difficulty of determining whether, say, an activity is business or not, or exempt rather than zero rated, which can drastically affect the level of recovery, there is the issue of the approach to apportionment of the related costs… Read more, click: here
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