Icy problem

Single or mixed supply?

The issue in this case was straightforward. When the taxpayers sold a package at a single price so that a child could go ice skating at a rink and hire a pair of skates was this a single supply – as argued by HMRC – or two separate ones – as contended by the taxpayers? This would not be a problem if both supplies were subject to the same rate of VAT but the hire of skates by children is zero rated (VATA 1994 Sch 8 group 16 item 1). The admission charge is standard rated.

The matter progressed to the First-tier Tribunal.

The tribunal decided that the supplies were separate and should not be treated as a single standard-rated supply of ‘skates with admission’. Referring to the decisions in Card Protection Plan v CCE (Case C-349/96) [1999] STC 270 and Levob Verzekeringen BV...