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Safestore Ltd v HMRC

In Safestore Ltd v HMRC [2020] UKUT 322 (TCC) (17 November 2020) the Upper Tribunal (UT) held that there was an exempt supply of insurance by the appellant and the related input tax was irrecoverable.

The appellant provided storage facilities in the UK. It required its domestic customers to take out insurance for stored goods and this was facilitated by an agreement (the ‘customs goods policy’) between the appellant and its sister company (A) a Guernsey-based insurance company. Under the terms of this agreement the appellant would collect premiums from its customers and pass 70% of the premium to A.

The appellant argued that the 30% of the premium which it retained was consideration for the provision of intermediary services to A. The effect of this was that input tax on costs relating to such activities was recoverable under the Specified Supplies Order SI 1991/3121 which provides...

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