Upper Tribunal rules Sonder Europe Limited not subject to VAT under tour operators’ margin scheme

• Sonder Europe Limited leased apartments for short-term accommodation
• First-tier Tribunal (FTT) ruled Sonder’s services were subject to VAT under TOMS
• Upper Tribunal upheld HMRC’s appeal, stating TOMS did not apply
• TOMS requires supply acquired by travel agent to be for direct benefit of traveler
• FTT decision based on Sonder not altering or processing apartments
• Upper Tribunal found FTT in error, services not for direct benefit of travelers
• UT considered services supplied by Sonder were materially altered from those supplied by landlords
• Sonder’s services were not onward supplies, but ‘in-house’ services outside TOMS

Source: taxscape.deloitte.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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