Hotels4U.com v HMRC

Cathya Djanogly

In Hotels4U.com v HMRC [2016] UKFTT 718 (24 October 2016) the FTT found that the internet provider of hotel accommodation acted as agent so that no VAT was due under the Tour Operator’s Margin Scheme (TOMS).

The issue was whether Hotels4U.com Limited (H4U) was supplying travel services to travellers as the agent of a disclosed principal or whether it was selling those services as principal. If Hotels4U was acting as agent its supplies were not liable to VAT in the UK; but if it was acting as principal it should account for VAT under TOMS.

H4U entered into contracts with suppliers of hotel rooms and displayed details of the hotels on its website. Travellers or travel agents would choose a hotel on the website; and a contract would be entered into either between a traveller and H4U or between a travel agent on behalf of...

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