We produce a free monthly email update on all VAT things great and small. It covers events for the last month and flags up significant changes as a result of changes to legislation, HMRC announcements and case law. It also looks at specific VAT issues that may affect a business.
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marcus.ward@consultant.com
07748 117935
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Marcus Ward Consultancy Ltd is pleased to announce the acquisition of the professional services practice of the consultancy called: VATAdvice. This longstanding and highly regarded practice based in Cambridgeshire is owned by Les Howard a well-known face in the VAT world. Les will continue his VAT support for charities and involvement with the Tax Tribunal.
Director Marcus Ward commented “There is a definite synergy between the two companies and I am pleased that I can continue to help Les’ clients with the highest level of service that I know they have been accustomed to. This will expand the practice’s existing offering to accountancy and legal firms. We are able to continue to offer VAT advice in the specific areas of; land and property, international transactions, and not for profit bodies as well as dealing with any other VAT issues. We are happy that Les has chosen us to carry on looking after his numerous clients and we aim to make the handover as smooth as possible for all of them”.
Marcus Ward Consultancy Ltd was formed two years ago to help businesses through the increasingly complex VAT regime. It has grown quickly in London and East Anglia and has clients across the world. It is a professional practice committed to providing the highest quality indirect tax advice in a timely and understandable way. It has expertise in both EC and UK legislation and over 25 years of indirect tax experience.
It is extremely commercially minded and works on the principle of “Leave VAT to us and you can concentrate on growing your business”.
It prides itself in defending businesses against unfair attacks from HMRC.
Enquires: marcus.ward@consultant.com
Telephone: 07748 117935
The weird side of VAT
We all know that the VAT rules throw up some oddities which are mainly the result of new products, technology and the way people live their lives now. I do think that the law needs a significant, consistent overhaul rather than a piecemeal approach, but let’s just consider some of the weird results the present system throws up. This is a MOSS* for all tabloid journalists….
* Mini One-Stop Shop
An odd rule applies to gingerbread men. No VAT is charged if the figure has two chocolate spots for its eyes, but any chocolate-based additions, such as buttons or a belt, mean VAT is payable.
The sale of a horse is standard rated. However, the sale of a dead one (for horse meat) is zero rated. I wouldn’t really want to dwell on the VAT planning aspects of this…
A downloaded purchase of the bible is standard rated while “saucy” top shelf magazines are VAT free.
So that’s what it’s called….. From HMRC guidance – “For the purposes of establishing the place of supply of services, stallion nominations (The right to nominate a mare to be covered by a stallion in one breeding season) and the covering of mares is treated as ‘work carried out on goods’”.
Food for wild birds is zero rated while food for caged birds is at 20%.
Well, what do you know?! Jaffa cakes are cakes, Pringles are crisps and now Lucozade Sport is a beverage. That’s what the Upper Tribunal has ruled, so the drink is now subject to VAT. So now we know.
(And since this is VAT, we have to mention Jaffa cakes – again!) It was ruled as a fact that cakes go hard when stale whereas biscuits go soft.
Food that is too hot to eat can be classed as cold food for VAT purposes.
Orange juice is zero rated. Lemon juice is zero rated. Mix them, and you have a standard rated product.
Peanuts in shells are zero rated, salted peanuts are standard rated.
If your shop is burgled, it’s best to let the robbers take your stock. Goods lost to theft are not subject to VAT, but if cash (which customers have paid for goods) is taken from the till a VATable supply has still been made and VAT is due on it.
The sales of kangaroos are standard-rated but kangaroo steaks are zero-rated.
Rabbits are zero-rated, even if sold as pets. Sales of pets are standard rated.
The sales of counterfeit (illegal) goods are subject to 20% VAT, but the sale of counterfeit banknotes are not.
There was a planning scheme called the golden toothbrush, but it didn’t matter what colour the toothbrush was.
Ferret food has recently been ruled to be subject to 20% when it was VAT free from 1973.
Caviar is deemed a necessity in terms of VAT, while orange squash is a luxury item.
Buying a coffin is standard-rated but hiring a hearse is VAT free.
Children’s clothing with rabbit and gazelle fur (and even dog skin) is zero-rated but if it has Tibetan goat fur it is subject to VAT.
Tuition provided by a sole practitioner is exempt, but if the tutor incorporates then their supplies become standard-rated.
In the Spearmint Rhino case it was ruled that there is no VAT on lap dances.
Under some VAT schemes, zero rated and exempt supplies are subject to VAT (and even some which are “Outside the scope of UK VAT”).
Dog food for a poodle is subject to VAT but exactly the same food can be zero rated if it is for a Labrador.
Please help to provide clean water to those that desperately need it in East Africa.
The lack of clean water means that people are dying. The charity Dig Deep is trying to help as many people as possible.
How you can help: My daughter Isabel Ward is taking part in Dig Deep fundraising events and to help them continue the work to get clean water to those who need it most. Any small donation to help get to her £2,990 target would be greatly appreciated.
The event: Isabel is climbing Mount Kilimanjaro for the charity in September 2015.
About
Isabel is currently a second year student at the University of Exeter studying English Literature. She has a strong passion for photography, yoga, running and anything literary based. As part of a large group from both the University of Exeter and Falmouth University, we are fundraising to climb Mount Kilimanjaro. The trek will take approximately seven days; five up and two down! She hopes to be doing some continual volunteer work in the local communities and see where our fundraising money will be going. Please help to provide clean water to those that desperately need it in East Africa.
Isabel’s sponsorship page: https://mydonate.bt.com/fundraisers/isabelward1
Dig Deep was set up in 2007 and helps to get clean water to communities in East Africa. They use current technology and methods to create a sustainable source of clean water, something that everyone deserves. By donating you’ll help for the equipment and teaching needed to help create and sustain clean and fresh water. Anything you can give will be greatly appreciated by myself and the people of East Africa. http://digdeep.org.uk/
Please Dig Deep!
Many thanks.
| From | To | Rate |
| 01 April 1973 | 28 July 1974 | 10% |
| 29 July 1974 | 17 June 1979 | 8% |
| 18 June 1979 | 31 March 1991 | 15% |
| 01 April 1991 | 30 November 2008 | 17.5% |
| 01 December 2008 | 31 December 2009 | 15% |
| 01 January 2010 | 03 January 2011 | 17.5% |
| 04 January 2011 | Current | 20% |
HMRC has published new advisory fuel rates for company cars, effective from 1 September 2014. and confirmed that it will also accept these fuel rates for VAT purposes.
They may be found here.
In the recent FTT case of Zipvit the court considered retrospective claims by businesses in cases where Royal Mail (and Parcelforce) had treated individually negotiated supplies of postage etc as exempt. In the previous ECJ case of TNT it was ruled that these services should have been standard rated. The claims (said to be over £1billion in total stood behind Zipvit) were made on the basis that recipients of these services could reclaim the VAT as input tax that should properly have been charged by the Royal Mail.
The three salient points where:
1. Where the supplies taxable? – On this point the court agreed with the taxpayer, the UK legislation must be read with the same restrictions as in the relevant EC Directive.
2. Was VAT due from, or paid by, the appellant? – Curiously, the judge did not agree with either party and stated that both had been labouring under a misapprehension. No further submissions were requested however, and on this point the appeal failed.
3. Lack of VAT invoice – Although HMRC have the discretion to accept alternative evidence to support an input tax claim, it was not obliged to. The FTT supported HMRC’s refusal and noted that there would, in any event, be a windfall for the applicant. The appeal was dismissed.
The judge commented that it was likely that this case would be appealed to a higher court.
If you have an appeal stood behind Zipvit, or have previously received exempt supplies from Royal Mail or Parcelforce in respect of individually negotiated contracts – please contact us for further information.