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Reed Employment Ltd and economic reality

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Reed Employment Ltd has created much excitement in the financial services sector (and other partially exempt sectors) because of the prospect raised by the First-tier Tribunal’s judgment, both of the chance to reduce both the future irrecoverable VAT cost associated with temporary workers, and to make significant reclaims for the past. The analysis hinges on the interpretation of the principle of ‘economic reality’ rather than a legalistic analysis that we may associate with Redrow.

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