Court of Appeal’s decision in Hotel La Tour Ltd

Back in October we reviewed the implications of the case of Hotel La Tour Ltd [2023] UKUT 00178 (TCC) (HLT) and observed that there was a spectre of increased input VAT recovery haunting the world of VAT. This spirit had been unleashed by the decisions of the First-tier Tribunal (FTT) and Upper Tribunal (UT) both of which found for the taxpayer.

However on 21 May the England and Wales Court of Appeal (CA) handed down its decision in the case ([2024] EWCA Civ 564). Metaphorically speaking the court appeared to have taken a leaf out of the book of the Ghostbusters. The aforementioned spectre was well and truly zapped leaving HLT covered in ectoplasm. HMRC by contrast was as smiley as the Stay-Puft Marshmallow Man.

Any appeal to the Supreme Court (SC) will be watched with lively interest. This case sheds...