VAT Treatment of Service Charges - The Latest Position
The CJEU gave its judgment on 27 September 2012, in the case of Field Fisher Waterhouse LLP v Commissioners for Her Majesty’s Revenue & Customs Case C-392/11.In the meantime, the First Tier Tax
The CJEU gave its judgment on 27 September 2012, in the case of Field Fisher Waterhouse LLP v Commissioners for Her Majesty’s Revenue & Customs Case C-392/11.
In the meantime, the First Tier Tax Tribunal decided, in the case of The Honourable Society of Middle Temple v HMRC, [2011] UKFTT 390, that a service charge gave rise to a separate supply, specifically relying on RLRE Tellmer Property sro v Finanèní øeditelství v Ústí nad Labem, ECJ Case C-572/07.
HM Revenue & Customs appealed to the Upper Tribunal against this decision and it seemed inevitable that the Upper Tribunal would have to consider the judgment of the CJEU in our case, in reaching its decision.
In such circumstances, there did not seem much point in having our case heard by the First Tier Tax Tribunal. We therefore sought the agreement of HM Revenue & Customs for our case to be stood over pending the decision of the Upper Tribunal in Middle Temple. HM Revenue & Customs did not agree to this and so a contested hearing on the point took place on 30 January 2013. The FTT agreed with us that our case should be stood over pending final determination of Middle Temple. It will now be for the Upper Tribunal (and possibly the higher UK courts) in Middle Temple to consider the apparently conflicting decisions of the CJEU in Tellmer and our case.
In the meantime, the First Tier Tax Tribunal decided, in the case of The Honourable Society of Middle Temple v HMRC, [2011] UKFTT 390, that a service charge gave rise to a separate supply, specifically relying on RLRE Tellmer Property sro v Finanèní øeditelství v Ústí nad Labem, ECJ Case C-572/07.
HM Revenue & Customs appealed to the Upper Tribunal against this decision and it seemed inevitable that the Upper Tribunal would have to consider the judgment of the CJEU in our case, in reaching its decision.
In such circumstances, there did not seem much point in having our case heard by the First Tier Tax Tribunal. We therefore sought the agreement of HM Revenue & Customs for our case to be stood over pending the decision of the Upper Tribunal in Middle Temple. HM Revenue & Customs did not agree to this and so a contested hearing on the point took place on 30 January 2013. The FTT agreed with us that our case should be stood over pending final determination of Middle Temple. It will now be for the Upper Tribunal (and possibly the higher UK courts) in Middle Temple to consider the apparently conflicting decisions of the CJEU in Tellmer and our case.