- The UK Supreme Court ruled that VAT on professional fees related to an exempt share sale cannot be reclaimed, even if the sale’s purpose is to fund taxable activities.
- The decision in HMRC v Hotel La Tour Ltd [2025] UKSC 46 upholds the Court of Appeal’s judgment and rejects the taxpayer’s argument for VAT recovery in fundraising contexts.
- The ruling clarifies that the ‘direct and immediate link’ test for input VAT recovery does not allow for disregarding the exempt nature of a share sale, even if proceeds are used for taxable purposes.
- This decision impacts businesses seeking to recover VAT on professional fees incurred during share sales to raise capital.
Source: twobirds.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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