Weekly VAT News

RCB 1(2024): Live streaming of funeral services

HMRC have issued RCB 1(2024) on the VAT treatment of the live web streaming of funeral, burial, or cremation services. Under Items 1 and 2, Group 8, Schedule 9 VATA 1994, VAT exemption applies to the disposal of the remains of the dead and to making arrangements for or in connection with the disposal of the remains of the dead. The provision of goods and services not directly connected with the making of such arrangements does not fall within the exemption. In RCB 1(2024), HMRC have confirmed that the supply of live web streaming of funeral, burial, or cremation services provided by an undertaker, cemetery, or crematorium operator is to be treated as exempt. Live web streaming services supplied by a third party for a separate consideration is not within the scope of the exemption. VAT Notice 701/32 (Burial, cremation and commemoration of the dead) has been updated to include information on HMRC’s policy. (Contact: Donna Huggard) 

H Ripley & Co Ltd: export evidence for scrap copper – FTT

In 2016, H Ripley & Co Ltd (HR) exported scrap copper to Recylink in Belgium. In May 2017, HMRC assessed HR for VAT of £1.1m on the basis that it had provided insufficient evidence to justify zero-rating. HR tried to find additional evidence, and provided P&O boarding cards and emails in March 2018. However, HMRC declined the additional evidence as it has been obtained more than 18 months after the exports, far outside the three-month time limit prescribed by the relevant VAT Notice (which had force of law). HR argued that the time limit required the export and the creation of the documentary evidence to be contemporaneous. However, the First-tier Tribunal rejected this argument. The Notice required HR to “obtain and keep valid commercial evidence” of the export within three months, and it was not enough that the evidence had come into existence, but had not yet been provided to HR. Even if the boarding cards had been considered, the FTT’s view was that they contained insufficient information to link a particular export to a specific sailing. The FTT also considered other evidence obtained by HR at the right time. In its judgment, sales invoices, bank statements, and weighbridge tickets contained no direct evidence of the movement of the scrap. International consignment notes (CMRs) had not been fully completed by the haulier or signed by the consignee. Annex VII documents (which accompany shipments) contained deliberate inaccuracies, as Recyclink did not want HR to know who its customer was. Given these deficiencies in the export evidence, HR had failed to satisfy the conditions for zero-rating its exports and its appeal was dismissed. (Contact: David Walters) 

Antri Georgiou: transfer of residence relief – FTT

In September 2022, Antri Georgiou took delivery of a Hyundai Tucson from a motor vehicle dealer in Cyprus. In February 2023, she moved to the UK and applied for transfer of residence (ToR) relief so that she could import the car without paying import VAT. HMRC refused, considering that she had moved to the UK in February 2023 and therefore failed to meet the condition that the car should have been in her possession and used by her in Cyprus for at least six months. The First-tier Tribunal has ruled that the ToR relief conditions were satisfied, as the relief requires at least six months of possession prior to importation, not prior to transfer of residence. Ms Georgiou had contacted HMRC in advance of importing her car, and by the time of the FTT hearing she had owned and used it in Cyprus for more than six months. The ToR relief requires property to be declared for relief up to six months before or twelve months after the change in normal residence, so the time limit for making an application operates by reference to transfer of residence. But the validity of the application refers to the date of import. Ms Georgiou’s appeal was therefore allowed. (Contact: Jeffrie Mann) 

Spring Budget 2024

The Chancellor of the Exchequer, Jeremy Hunt, will deliver the government’s Spring Budget 2024 on Wednesday, 6 March 2024. The Spring Budget will be accompanied by the latest forecasts from the Office for Budget Responsibility (OBR) for the UK’s economy. Please visit our Spring Budget 2024 page for our coverage of key tax announcements. There will be a Dbriefs webcast on Thursday, 7 March 2024 at 12.00, during which our panel will discuss the OBR’s outlook for the economy and the Chancellor’s tax announcements.

 This week’s CJEU indirect case calendar

On 7 March, the CJEU will deliver judgments in Feudi di San Gregorio Aziende Agricole on the effect of low turnover on taxable person status, and in Fallimento Esperia and GSE on requirements for the importation of green energy. There will be an Advocate General opinion in Latvijas Informācijas un komunikācijas tehnoloģijas asociācija on VAT and state-funded training services.