Lee Squires and Fiona Bantock review the VAT developments that matter
Compound interest: LittlewoodsThe CJEU has given judgment in Littlewoods Retail v HMRC (Case C-591/10) concerning whether taxpayers have an entitlement to compound interest on repayments of overpaid VAT from HMRC rather than only simple interest in accordance with VATA 1994 s 78. The CJEU confirmed that where tax has been imposed in breach of EU law the taxpayer is entitled to reimbursement of that tax with interest. However it is for each Member State to determine the rate of that interest and method of calculation (whether simple or compound) provided its rules comply with the EU law principles of effectiveness...
