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VAT partial exemption and foreign branches

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Deloitte reports that the changes to the VAT regulations would be made to prevent partially exempt businesses from taking account of supplies made by foreign branches when reclaiming input tax in the UK ‘is likely to have been’ postponed, with HMRC reviewing the draft regulations in light of comments it has received. HMRC’s announcement at the March 2015 Budget that the proposed changes, which would implement the CJEU’s 2013 decision in Crédit Lyonnais, would take effect from the beginning of the partial exemption year starting on or after 1 August 2015, although Deloitte has suggested it has the effective date may be ‘perhaps 1 January 2016’.

Issue: 1273
Categories: News , VAT