In HMRC v Temple Finance and another [2017] UKUT 315 (4 August 2017) the UT found that a group structure which involved two companies in the same business did not breach the principle of fiscal neutrality.
The two associated companies (TF and TR) carried out the ‘PerfectHome’ business. The business involved the sale of household goods and electronic goods to consumers. It was aimed at credit constrained customers and most of the goods were sold under hire-purchase contracts together with (optional) insurance and warranty.
TF provided finance and other services to customers whilst TR sourced and supplied the goods. HMRC appealed against the FTT’s decision that the ‘two company’ structure had not been set up with a view to securing VAT advantages but had clear commercial advantages. In HMRC’s view a single taxable person would have incurred higher irrecoverable input tax.
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In HMRC v Temple Finance and another [2017] UKUT 315 (4 August 2017) the UT found that a group structure which involved two companies in the same business did not breach the principle of fiscal neutrality.
The two associated companies (TF and TR) carried out the ‘PerfectHome’ business. The business involved the sale of household goods and electronic goods to consumers. It was aimed at credit constrained customers and most of the goods were sold under hire-purchase contracts together with (optional) insurance and warranty.
TF provided finance and other services to customers whilst TR sourced and supplied the goods. HMRC appealed against the FTT’s decision that the ‘two company’ structure had not been set up with a view to securing VAT advantages but had clear commercial advantages. In HMRC’s view a single taxable person would have incurred higher irrecoverable input tax.
...
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