Roof panels provided more than just insulation

The taxpayer’s main business was the supply and installation of insulated roof panels for conservatories.

HMRC considered this was a standard-rated supply and raised assessments. The taxpayer appealed. It said the predominant characteristic of the panels was insulation and they therefore qualified for the reduced rate of VAT (5%) as energy-saving materials (VATA 1994 Sch 7A gp 2 note 1(a).

Both the First-tier Tribunal and the Upper Tribunal dismissed the taxpayer’s appeal.

In the Court of Appeal LJ Whipple delivered the judgment. She said the First-tier Tribunal had posed the right question in asking whether it was fair to interpret the words ‘insulation for roofs’ as including the type of roofing panels supplied by the taxpayer. However it made a material error in concluding that if the supply was not of insulation for roofs it must have been the supply of a roof.

The question was whether the supplies were...