Market leading insight for tax experts
View online issue

Investment Trust Companies and VAT recovery

The scenario this case addresses seems almost a law school exam question. A supplier provides a customer with services which should have been exempt from VAT but which the legislation makes subject to VAT of £100. To do so it buys in professional services from an adviser which attract VAT of £25. The supplier charges the customer and recovers VAT of £100. It deducts the £25 input VAT which it paid to the adviser and accounts to HMRC for the balance of £75. Only then does it become clear that the legislation was contrary to EU law and HMRC refunds the £75 which the supplier pays back to the customer. What happens to the £25?

If you or your firm subscribes to, please click the login box below:

If you do not subscribe but are a registered user, please enter your details in the following boxes:

Alternatively, you can register free of charge to read a limited amount of subscriber content per month.
Once you have registered, you will receive an email directing you back to read this article in full.
Please reach out to customer services at +44 (0) 330 161 1234 or '' for further assistance.