VAT exemption for insurance intermediaries

Whilst the VAT system has always provided an exemption for related services performed by insurance brokers and agents together with related administrative services they perform the increasing sophistication of insurance price comparison websites has led to uncertainty as to whether these sites were entitled to benefit from the exemption. HMRC relied on earlier case law including Skandia (C-240/99) Taksatorringen (C-8/01) and Andersen (C-472/03) which requires a direct legal relationship between intermediary and insured. Ludwig (C–453/05) (re. the exemption for financial services) has overturned that doctrine.

Price comparison websites: In the recent case of HMRC v InsuranceWide.com Services Ltd and Trader Media Group Ltd a company operated a website by which prospective customers were provided with a 'comparison service' for insurance cover from various insurers. HMRC issued a ruling that the companies...