Shawbrook Bank provides mortgages and loans, while Target administers the loans on behalf of Shawbrook. Target’s services include creating loan accounts, recording account information, interacting with borrowers, setting up direct debit instructions, processing payments, and reconciling loan accounts. The taxpayer requested clearance from HMRC to treat its supplies as a single exempt supply of payment processing. The taxpayer argued that its services fell within the exemption because they involved payments and transfers, as well as inputting entries into borrowers’ loan accounts. The Supreme Court considered relevant case law and highlighted the need for services to fulfill the specific functions described in the exemption. It noted that there was some uncertainty regarding whether the services themselves must have the effect of transferring funds and making changes, or if it was sufficient for them to have a causal effect. The Court referred to previous domestic cases and acknowledged that doubts had arisen about the interpretation of the exemption.
Source KPMG
Latest Posts in "United Kingdom"
- Campaign Urges Government to Remove VAT on Children’s Oral Hygiene Products to Tackle Tooth Decay
- UK Budget 2025: VAT E-Invoicing, Digital Compliance, and Post-Brexit Tax Reforms Announced
- FTT Rules HMRC Closure Notice Bars VAT Registration: Hairdresser’s Turnover Below Threshold, Appeal Allowed
- UK Tribunal Rules Self-Employed Hairdresser Not Liable for VAT Registration Under Rent-a-Chair Model
- EU Insists on VAT Representative for UK Firms Despite British Objections to Import Rules
