Services or goods?

The taxpayer took over the lease of premises previously been used as a hairdressing salon to convert it to a café. She hired her husband’s building company L to carry out the refurbishment. The café opened in June 2007 and was not registered for VAT.

HMRC conducted an investigation into the café in 2010 and ruled it should have been registered for VAT from October 2008.

The taxpayer claimed input tax in her VAT return for the period from October 2008 to May 2011 on the invoice from the building company on the basis it related to the supply of goods. A taxpayer can claim input tax on supplies of goods for up to four years before registration and on supplies of services for up to six months before registration

The Revenue said the invoice related to supplies of services and disallowed the claim....