In this month’s VAT updates, Graham Elliott considers charity construction relief in Marlow Rowing Club, HMRC’s reaction to the News Corp decision and the supply of medics in Archus Trading Ltd
Case: Charity Construction Relief
The Upper Tribunal has ridden to the rescue of Marlow Rowing Club (UKUT0020) as regards the liability to pay VAT on construction services. It was accepted by the charity that it had not qualified for the VAT relief for construction of a new building, but at the time of issuing a certificate to obtain the relief from the builder, it had thought it did.
This was based on the state of case law at that time and the advice it took. HMRC argued that the club’s failure to obtain explicit HMRC clearance (which it acknowledged would have been denied) meant that the charity had issued the certificate carelessly.
The case involved an argument over the detail in the advice taken, which had led the First Tier Tribunal (FTT) to decide that the charity had been careless. The Upper Tribunal did not agree with that conclusion and allowed the appeal against the penalty.
