CJEU ruling favours HMRC over payment handling

The long-awaited decisions by the Court of Justice of the EU (CJEU) in Bookit (C-607/14) and National Exhibition Centre (C-130/15) have been issued, and have both favoured HMRC’s interpretation. The cases were similar in that the service providers arranged customer bookings for theatres or other events, giving rise to issuing tickets, and taking payments, usually by credit and debit card. The issue was whether their supply was exempt as a financial service relating to the transfer of money between the customer and seller. References were made to the CJEU in both cases, and the decisions were issued simultaneously.

The CJEU decided that the supplies are not exempt. In the case of NEC, it actually declined only to answer the questions from the UK court. These questions focused on whether the actions adopted by NEC were sufficient to give rise to the exempt ‘transfer of money’, or were one step removed. The questions also asked whether these would be regarded as ‘debt collection services’, and therefore excluded from the exemption.

Howev