News - tax case

Exempt bookings

A call centre provided a booking service for cinema goers. It charged a handling fee of 50 pence per ticket to a £2 maximum. Customs said that the supply of services by the taxpayer company to the customer was liable to VAT at the standard rate. The taxpayer appealed claiming that the supply of services was exempt under VATA 1994 Sch 9 Group 5 item 5 as it was a supply of financial services.
The tribunal found that the transaction did not involve a transfer of funds by the taxpayer or a change in the legal and financial situation but was limited to the receipt and transmission of information. It dismissed the appeal so the taxpayer appealed to the High Court where the Vice Chancellor overturned the tribunal's decision so Customs appealed.
The Court of Appeal said that the Vice Chancellor was...