Pre-Registration VAT Recovery: Aspire in the Community v HMRC on Use-Based Method and Input Tax

• The case concerns whether pre-registration VAT can be recovered using the use-based method under VAT regulations.
• The Tribunal held that pre-registration usage does not need to be taken into account when applying the use-based method to input tax under regulation 111.
• Input tax incurred on services before making taxable supplies is, in principle, deductible.
• The appeal by Aspire in the Community Services Ltd was allowed, overturning HMRC’s refusal to repay part of the input tax.
• The decision affects similar pending appeals in the care sector regarding pre-registration VAT recovery.

Source: bailii.org

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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