Recent tribunal decisions have provided clarity on mixed supplies

VAT and mixed supplies: how can one topic cause so much confusion and debate and – almost certainly – incorrect VAT accounting by thousands of UK businesses? The timing of this article is appropriate for two reasons. Firstly there has been a recent First-tier Tribunal (FTT) victory for the taxpayer about whether fuel subject to 5% VAT was a separate supply to the hire of plant and vehicles. And secondly it is 25 years since the European Court of Justice gave its landmark ruling in Card Protection Plan Ltd (C-349/96) [1999] STC 270 (CPP) which was supposed to clear the muddy waters once and for all. It didn’t.

In this article I will focus on three recent FTT decisions which I feel have finally given us some consistency in the issues to consider on this difficult topic. There are common themes in...