Latest News
Last week saw the release of the Advocate General’s (“AG”) opinion in the case of Littlewoods Retail Ltd v HMRC, on which the UK courts had referred a number of question to the European Court of Justice (“ECJ”). The Littlewoods case had given the UK courts a number of points to consider in relation to taxpayers entitlement to receive a payment of compound interest following the repayment of VAT collected by HMRC in breach of EC Legislation. A number of cases in the courts have been ‘stayed’ pending the outcome of the Littlewoods ECJ reference.
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All of us at The VAT People would like to wish you a very Merry Christmas and all our best wishes for the New Year!
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HMRC yesterday released the summary of responses to their
proposed Cost Sharing Exemption that the Chancellor announced to great fanfare
in his Autumn Statement. So just how useful will this new exemption
be?
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Recent BBC News reports suggest that following HMRCs recent
investigations into plumbers and restaurants, their tax evasion net is being
spread wider. As well as the obvious choices of the wealthy with assets
abroad and those who hold money in offshore bank accounts, their list now
includes private tutors, scrap metal dealers, doctors and dentists. The
figures the BBC reports are that around 2,500 doctors and dentists will receive
a letter in the next few days, giving them 21 days to pay any unpaid taxes or
face prosecution. Early next year, this net will spread wider still to
include those selling on internet marketplaces and electricians. Given these efforts to recover unpaid
tax in professions and trades that HMRC deem risky, VAT is likely to be high on
the agenda.
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The long awaited European Court of Justice, or ECJ, judgement has
finally been released in the case of Rank Group, and as ever the VAT world and
interested parties have been waiting with baited breath. The ECJ decision in itself
does not decide the winners or losers of the appeal, indeed it cannot do so
given the ECJs role as a provider of clarification rather than as a court of
tribunal, but it has given us a clearer view of how the world of VAT should be
shaped.
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There has been wide
spread coverage of measures taken by HMRC to close a ‘VAT loophole’ from next
April. This has been touted in the national press as a measure aimed at
preventing VAT avoidance and distortions of trade. Whilst having some sympathy
with HMRC’s view, to describe this as completely closing a loophole is somewhat
wide of the mark. The scheme that has been referred to as a loophole is in fact
an EC wide trade facilitation measure that is part of the EC VAT directives
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That extra large value contract that we didn’t see
coming, the really good period sales-wise that we just didn’t think meant anything
more than we’d had a good quarter and there was some extra cash around, these
nice little moments are few and far between and we should enjoy them. But as Vince Cable has found out, there’s a
downside too...
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There has been speculation in the press that a ‘boob’ tax
will be introduced for cosmetic procedures and that this is a change to current
VAT legislation. Our view is that the papers have made a bit of a boob as there
is no actual change from the current VAT position. European case law dating
from 2005 established that any treatments or procedures by medical Practioners
that are not provided for the purposes of the health or welfare of the patient
are plus VAT.
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HMRC have updated their
Public Notice 701/5 Clubs and Associations. The VAT position for
Clubs and Associations can be complex and is a topic that we recommend you keep
on your radar.
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Do you have concerns that your client is not satisfying the cultural services exemption?
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