- Reclaimed VAT on legal costs may not always be straightforward
- Recent case highlighted issues with VAT recovery on legal costs
- Legal costs must have direct and immediate link to taxable supplies to be recoverable
- First Tier Tax Tribunal ruled against recovery of VAT on legal costs in Visual Investments International Limited v HMRC case
- Businesses should be cautious when assuming VAT on legal fees is recoverable
- Engagement letters can help determine recipient of legal services for VAT recovery purposes
Source: saffery.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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