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VAT updates: September 2019

In this month’s VAT updates, Graham Elliott, director at City & Cambridge Consultancy, considers whether the provision of nursery education is non-business, the case of a DIY housebuilder who took HMRC to tribunal after the failure of an Alternative Dispute Resolution process, a new angle on the provision of management services to overseas subsidiaries and the end of the road for the Smart case on input tax for farm subsidies

Case: whether education is non-business

The First Tier Tribunal (FTT) has given an important decision relating to whether a particular (and seemingly untypical) school makes business supplies. The issue’s importance lies in whether the charity can procure zero rated construction services.

The case is that of Yeshivas Lubavitch (TC07242) and includes interesting comment on whether a construction project relates to an annexe.

HMRC’s objection on the ‘non-business’ point was that it regarded parent payments as being school fees rather than donations, and that such fees amounted to consideration paid in the course of a business.

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