HMRC has set out its revised view of the VAT treatment of 'pay per click' (PPC) sponsored links on search engine websites that direct users to a charity's website. HMRC had previously considered that PPC links were not advertisements but simply a means of access to a charity's website. As such the costs of providing PPC links were treated as costs of providing a charity's website which are expressly excluded from zero-rating under VATA 1994 Sch 8 Group 15 Note 10B.
HMRC now accepts that PPC links are advertisements and will qualify for zero-rating when supplied to a charity. Businesses that have paid VAT on supplies that are now considered to be zero-rated may submit claims for overpaid tax subject to a four-year limitation period.
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HMRC has set out its revised view of the VAT treatment of 'pay per click' (PPC) sponsored links on search engine websites that direct users to a charity's website. HMRC had previously considered that PPC links were not advertisements but simply a means of access to a charity's website. As such the costs of providing PPC links were treated as costs of providing a charity's website which are expressly excluded from zero-rating under VATA 1994 Sch 8 Group 15 Note 10B.
HMRC now accepts that PPC links are advertisements and will qualify for zero-rating when supplied to a charity. Businesses that have paid VAT on supplies that are now considered to be zero-rated may submit claims for overpaid tax subject to a four-year limitation period.
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:
