- From 26 November 2025, HMRC will no longer follow the Skandia judgment for VAT grouping rules.
- Overseas branches of UK entities will be treated as part of the same taxable person, not as separate entities, for UK VAT purposes.
- Intra-entity services between UK entities and their overseas branches will generally not be subject to UK VAT.
- This revised interpretation also applies to UK VAT groups with overseas establishments, even in EU states with different VAT grouping rules.
- UK VAT groups that overpaid VAT under the previous interpretation may reclaim it through the error correction procedure.
Source: taxand.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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