Peter Stewart and Paul Farmer (Joseph Hage Aaronson) examine the decision that so-called agility hire purchase contracts are a supply of services and consider its practical implications.
Motor companies commonly offer several types of agreement by which a customer can acquire a vehicle. To establish the VAT treatment of these agreements under EU Directive 2006/112 (the Principal VAT Directive or ‘PVD’) each agreement needs to be classed as either a supply of goods or a supply of services. This classification can lead to significant consequences for taxpayers.
In the case of Mercedes customers can choose to enter into one of three financial products:
A leasing agreement under which the customer hires the vehicle for 36 months in exchange for a monthly payment. There is no option to purchase the vehicle and the customer returns the vehicle to Mercedes at the end of...
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Peter Stewart and Paul Farmer (Joseph Hage Aaronson) examine the decision that so-called agility hire purchase contracts are a supply of services and consider its practical implications.
Motor companies commonly offer several types of agreement by which a customer can acquire a vehicle. To establish the VAT treatment of these agreements under EU Directive 2006/112 (the Principal VAT Directive or ‘PVD’) each agreement needs to be classed as either a supply of goods or a supply of services. This classification can lead to significant consequences for taxpayers.
In the case of Mercedes customers can choose to enter into one of three financial products:
A leasing agreement under which the customer hires the vehicle for 36 months in exchange for a monthly payment. There is no option to purchase the vehicle and the customer returns the vehicle to Mercedes at the end of...
If you or your firm subscribes to Taxjournal.com, please click the login box below:
If you do not subscribe but are a registered user, please enter your details in the following boxes:
