- The Upper Tribunal decided that the Tour Operators Margin Scheme (TOMS) does not apply to serviced accommodation.
- The decision was based on the UK VAT legislation which states that the supply must be made to a traveller “without material alteration”.
- The Upper Tribunal found that Sonder changed the nature of the supply by leasing accommodation on long leases but letting it out as short-term holiday lets.
- The Upper Tribunal decision creates a precedent and is binding on all UK taxpayers.
- Operators will be expected to review their VAT accounting and account for VAT under the normal rules, not TOMS.
- Sonder has applied for permission to appeal the decision to the Court of Appeal.
Source: servicedapartmentnews.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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