Derby Quad Ltd (DQ) shows a range of films and live events, including screenings of plays performed on stage by theatre companies such as the National Theatre and Royal Shakespeare Company. DQ pays a percentage of ticket sales and a flat fee per simultaneous screening to the theatre companies. The taxpayer argues that these live events qualify for VAT exemption under VATA 1994 Schedule 9 Group 13 Item 2(b) as a right of admission to a theatrical performance of a cultural nature. However, HMRC disputes this interpretation and refers to previous cases such as Chichester Cinema and British Film Institute. The FTT examines the arguments put forward by both parties and ultimately concludes that the taxpayer’s supplies do not qualify for VAT exemption as a right of admission to a theatrical performance.
Source KPMG
