Insurers operating in an international context face some of the most complex VAT issues imaginable, Peter Hewitt explains
VAT for the insurance industry is complicated by the fact that in the EU at least insurance underwriting and broking is exempt. This leads to the usual disputes with tax authorities over the level of input tax deduction under partial exemption rules but over and above those difficulties insurers and brokers operating in an international context meet up with some of the most complex VAT issues imaginable. Because their input tax recovery is limited it is critical that they make sure the correct amount of VAT is accounted for in the correct territory. This applies particularly to international cross-charges within a corporate group.
The sorts of issues faced for example by...
