VAT Cases

Summaries of interesting VAT cases for the SME owner.

In Kinnerton Confectionery Limited v HMRC [2018] TC06548¸ the FTT decided that an allergen-free chocolate bar was standard rated as confectionary and was not food for VAT.

In Marcandi Ltd v HMRC [2018] C-544/16, the CJEU ruled that the bid credits sold by ‘Madbid’ to penny-auction participants are supplies of services, not part of the supply of goods.

HMRC have published ‘Alternative method of VAT collection – split payment: summary of responses’, and have indicated they will continue to work towards a viable alternative VAT collection model for online shopping.

In Ryanair Ltd v The Revenue Commissioners [2018] C-249/17, the CJEU ruled that VAT on consultancy fees relating to a failed takeover bid was recoverable as Ryanair intended to make taxable management services to the target.

HMRC have published ‘VAT, Air Passenger Duty and Tourism in Northern Ireland: summary of responses’ and, whilst acknowledging the effect on tourism of these taxes, will take no action at this stage.

In Loughborough Students’ Union v HMRC [2018] UKUT 3434, the Upper Tribunal (UT) decided that sales of stationery, art materials and other items from student union shops were not exempt supplies closely related to education.

In HMRC v Volkswagen Financial Services (UK) Ltd [2018] C-153/17, the Court of Justice of the European Union (CJEU) ruled that HMRC cannot treat VAT on costs as solely relating to exempt finance charges when a car is bought on HP.