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One minute with ... Graham Elliott

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How did you end up specialising in VAT?

It was by accident. I started off my career teaching children history – when I bowed out of that I was picked up by Customs and Excise and put into their VAT department and was hooked by what it taught me about business.

Who in VAT do you most admire?

Mike Thexton, a tax trainer who trained me for CTA when I was at Arthur Andersen. His ability to convey the subject both humorously and clearly, and with a huge depth of technical knowledge, is probably unique in my experience.

What advice would you give to someone entering the profession?

When giving VAT advice always make sure you fully understand the business situation – does it stack up from a pure business perspective? And beyond that, what is the operational situation that’s being described to you – does it make sense? Without understanding that you are risking misunderstanding the overall situation, and your VAT advice may not be correct as a consequence.

What’s a common VAT problem you encounter time and again?

There are several. On the property side, there’s the issue of whether or not the option to tax anti-avoidance provisions in Schedule 10 apply. The way those provisions has been framed is wrong-headed and I would like to see them reformed. The decision in Weald Leasing suggests they have limited legitimacy.

For charities, the issue that often causes confusion is whether a particular funding arrangement is a contract for a service provided to, say, a local authority or a grant. There is often no right or wrong answer, and HMRC’s tendency to sit on the fence on that can leave great uncertainty between the parties.

What did you think of the VAT measures in the Budget?

The one measure which hasn’t received as much publicity as it should is the removal of zero rating for alterations to listed buildings. In this country we have fantastic stock of well maintained old buildings under the listed buildings system. The Budget measure was presented as removing a ‘perverse’ incentive to alter a building, rather than to repair it. But people only alter buildings to make them usable in the modern age, not because of a VAT incentive. Without that relief you are going to reduce the amount of money that can be spent on sensitive alterations, and it will thus have a detrimental effect on the stock of listed buildings. If the government had wanted it to be an effective wealth tax on people who own listed buildings they should have said so, rather than presenting it as the tidying up of an anomaly.

What would your advice be to the government on ‘pasty tax’?

It would be that you have got it wrong because you haven’t appreciated the difficulties in the borderline that you’ve now created between hot food, or warm and tepid food, and room temperature or cold food. What would have been sensible is to apply a similar rule to pasties etc as we have for bread – that in order to be zero rated the pasty should simply be brought out of the oven and allowed to cool naturally towards room temperature.

If you hadn’t gone into VAT, what else might you have done?

In my dreams, I’d like to be a professional author of novels or a professional clarinettist.

Issue: 1118
Categories: One minute with