Christine Yuill and Richard Croker (Pinsent Masons) discuss the VAT considerations in respect of lease variations as tenants seek to negotiate lower rental liabilities during Covid-19.
With many tenants experiencing financial difficulties in light of Covid-19 landlords are being asked to vary the terms of leases to help with cash flow. The variations often involving no monetary consideration changing hands highlight the difficulties associated with the VAT rules in relation to ‘barter’ transactions. HMRC issued guidance on 29 July 2020 in relation to certain lease variations (Revenue & Customs Brief 11/2020) but there are many other property barter transactions where the position is less clear. This article sets out the implications of HMRC’s guidance and highlights the VAT considerations for property transactions not covered by the guidance.
What is a barter transaction for VAT purposes?
The term ‘barter’ is one of...
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Christine Yuill and Richard Croker (Pinsent Masons) discuss the VAT considerations in respect of lease variations as tenants seek to negotiate lower rental liabilities during Covid-19.
With many tenants experiencing financial difficulties in light of Covid-19 landlords are being asked to vary the terms of leases to help with cash flow. The variations often involving no monetary consideration changing hands highlight the difficulties associated with the VAT rules in relation to ‘barter’ transactions. HMRC issued guidance on 29 July 2020 in relation to certain lease variations (Revenue & Customs Brief 11/2020) but there are many other property barter transactions where the position is less clear. This article sets out the implications of HMRC’s guidance and highlights the VAT considerations for property transactions not covered by the guidance.
What is a barter transaction for VAT purposes?
The term ‘barter’ is one of...
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:
