The FTT decision in NEC has confirmed that the VAT exemption can apply to a credit/debit card handling fee, where the charge is levied by a separate legal entity to that supplying the main item. It dismissed HMRC’s insistence on the ‘fourth condition’ from its Bookit Business Brief being present for exemption to apply. In terms of wider application, the NEC decision (and the Bookit decision before it), supports the simple analysis that the VAT treatment of a supply by a separate legal entity, contracting directly with a consumer to provide him with a specific service, is to be considered in its own right.
