Following the recent decision in Pactor Vastgoed on the Dutch option to tax, Gary Richards and Alan Sinyor analyse the possible implication for the UK system, especially for those taxpayers who accounted for VAT under the capital goods scheme following the purchase of a property as a TOGC.
Pactor Vastgoed (C-622/11) a case that came before the CJEU on the intricacies of the Dutch option to tax might not sound to be of much significance to UK property owners.
On the contrary one reading of the CJEU’s judgment is that the UK capital goods scheme (CGS) may not operate as intended and so as a result taxpayers may have both statutory repayment claims and mistake-based restitution claims where property TOGCs have occurred.
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