ING Intermediate Holdings v HMRC

In ING Intermediate Holdings v HMRC [2017] EWCA Civ 2111 (13 December 2017) the Court of Appeal found that ING was not only receiving deposits but also providing banking services for consideration.

ING sought to recover (via deduction against the outputs of a separate investment business) a proportion of VAT expenses incurred in connection with a deposit-taking business. It contended that the deposit taking was simply the lending of money to ING which did not involve a supply by ING for VAT purposes. HMRC considered however (and so had the FTT and the UT) that ING carried more than a deposit-taking business and provided banking services. This meant that HMRC had correctly denied recovery of the disputed input tax on the basis that the expenses incurred had a direct and immediate link with exempt supplies made in the course of the deposit-taking activities.

The Court of Appeal...