HMRC’s revised business test for VAT purposes oversimplifies the law almost to the point of misrepresenting it, writes Etienne Wong (Old Square Tax Chambers).
Back in the 1970s Lord Fisher organised shoots for himself his friends and relations. He acknowledged in the eponymous VAT case ([1981] STC 238) that by accepting contributions to the cost of the shoots from his guests he was doing something (allowing them to join the shoots) for a consideration which of course is the very definition of a supply of services (see VATA 1994 s 5(2)(b)). That was not enough on its own to trigger a VAT charge however; in order for the supply to be a taxable supply it had to be made in the course or furtherance of a business (as required under VATA 1994 s 4(1)).
In the event the High...
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HMRC’s revised business test for VAT purposes oversimplifies the law almost to the point of misrepresenting it, writes Etienne Wong (Old Square Tax Chambers).
Back in the 1970s Lord Fisher organised shoots for himself his friends and relations. He acknowledged in the eponymous VAT case ([1981] STC 238) that by accepting contributions to the cost of the shoots from his guests he was doing something (allowing them to join the shoots) for a consideration which of course is the very definition of a supply of services (see VATA 1994 s 5(2)(b)). That was not enough on its own to trigger a VAT charge however; in order for the supply to be a taxable supply it had to be made in the course or furtherance of a business (as required under VATA 1994 s 4(1)).
In the event the High...
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If you do not subscribe but are a registered user, please enter your details in the following boxes:
