A taxpayer may recover input VAT on a taxable supply of goods or services if: (1) those goods or services were supplied to the taxpayer; and (2) they were used, or to be used, for the purpose of its business. The Court of
Appeal in Praesto Consulting UK Ltd v HMRC [2019] EWCA Civ 353 held that, under issue 1, the tribunal can look at the economic reality of the supply; and issue 2 requires a direct and immediate link to the taxable person’s economic
activity as a whole, which in the context of legal services may be as broad as a real risk of litigation.
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A taxpayer may recover input VAT on a taxable supply of goods or services if: (1) those goods or services were supplied to the taxpayer; and (2) they were used, or to be used, for the purpose of its business. The Court of
Appeal in Praesto Consulting UK Ltd v HMRC [2019] EWCA Civ 353 held that, under issue 1, the tribunal can look at the economic reality of the supply; and issue 2 requires a direct and immediate link to the taxable person’s economic
activity as a whole, which in the context of legal services may be as broad as a real risk of litigation.
If you are not a subscriber, subscribe now to read this content.
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