HMRC v Imperial College of Science, Technology and Medicine

In HMRC v Imperial College of Science Technology and Medicine [2016] UKUT 278 (24 June 2016) the UT found that HMRC had agreed a PESM (partial exemption special method) so that it applied to Imperial’s claim for repayment.

Imperial had made a claim for repayment of residual input tax relating to overheads of its academic departments. The dispute was about the basis on which the net VAT originally paid for the relevant years had been calculated. Imperial’s case was that the relevant calculations of recoverable VAT had been made pursuant to a method whose terms had been agreed with HMRC as a PESM; whilst HMRC contended that the relevant calculations had been made under a compromise of claims made by Imperial in respect of specific accounting periods. If Imperial was right the PESM applied to the repayment claim; whereas if HMRC was correct the calculations would...