The VAT briefing for December 2017

In Littlewoods, the Supreme Court held that there is no entitlement to compound interest on overpaid VAT. The Office of Tax Simplification has published its report on VAT simplification, which includes a number of recommendations for the government to create a simpler VAT system. HMRC has published updated guidance on when VAT incurred on costs relating to pension schemes may be recovered by the trustees of the scheme or the sponsoring employer. In Volkswagen, the advocate general opined that input VAT recovery should be permitted where a supply was treated (in good faith) as not taxable, but subsequently an adjustment is made and VAT paid.