Indirect tax news from the past week
26 January 2026
Medpro Healthcare Limited & Ors: Application for a late appeal – CA
In 2023, the First-tier Tribunal refused Medpro Healthcare Limited (and others) permission to bring a VAT appeal against a penalty assessment and personal liability notices out of time. The Upper Tribunal subsequently allowed Medpro’s appeal, and remitted the matter back to the FTT. However, the two UT members disagreed on ground of appeal four, which questioned the previous UT decision in Katib (and, in effect, Martland) on the basis that it had “improperly constrained the FTT’s discretion to extend time for out-of-time appeals”. Marcus Smith J considered that the UT is not permitted to give guidelines to the FTT as to what weight to place on particular factors when considering whether to extend time for an appeal, and would have allowed the appeal on ground four. Judge Cannan, however, was “not convinced that Martland and Katib are wrong”, and considered that providing such guidance is part of the function of the UT, to promote consistency in FTT decisions. As Marcus Smith J had the casting vote, his view prevailed, with both members agreeing that if it was permissible for the UT to give guidance, the guidance given by the UT in Martland was appropriate. In considering HMRC’s appeal against the UT’s decision on ground four, the Court of Appeal has held that “Marcus Smith J was wrong, and Judge Cannan was right”. The CA considered that the UT is entitled to give guidance to the FTT on the exercise of a statutory discretion. The CA allowed HMRC’s appeal, and concluded that upon remittal of the application, the FTT should proceed on the basis that the Martland guidance, as amplified in Katib, is appropriate. (Contact: Rob Holland)
Slice of Pie Limited: Whether a supply was of catering services – FTT
Slice of Pie Limited (SPL) supplied food to nurseries for lunches and afternoon teas. The food was supplied cooked and hot, with each component of the meal (protein, carbohydrate, vegetables, pudding, etc.) delivered in separate containers. Upon delivery, nursery staff would prepare and serve the food onto individual plates for each child. SPL submitted a VAT claim to HMRC on the basis that the supply was zero-rated as a supply of food. HMRC considered that the supply was of catering, and therefore standard-rated. The First-tier Tribunal has agreed with HMRC. The FTT considered the factors for and against the supply being ‘catering’, and concluded that “the ordinary person would regard the supply as catering: hot, ready-to-eat meals delivered for immediate consumption, ordered from a menu, and presented in a manner consistent with commercial catering”. The additional steps undertaken by the nurseries did not amount to significant food preparation. The FTT dismissed SPL’s appeal. (Contact: Katy Sweaton)
VAT case calendar – a look ahead
Looking ahead, there are a number of VAT appeals due to be heard by the Court of Appeal in the first half of 2026, including:
On 20 January 2026, there was a Court of Appeal hearing in FS Commercial Limited concerning input tax deduction and the inclusion of previously unprovided VAT invoices at the hearing. Also on 20 and 21 January, the Court of Appeal heard an appeal against the High Court’s judgment in Emmanuel School (Derby) Limited t/a Emmanuel School & Ors on the judicial review claims concerning the application of VAT to private school fees.
The Upper Tribunal is due to hear appeals from the First-tier Tribunal in Boehringer Ingelheim Limited concerning VAT and pharma rebates on 9 February 2026, and Barclays Services Corporation & Anor concerning VAT grouping on 2 March 2026.