- Boehringer Ingelheim Limited (BIL) made payments to the Department of Health and Social Care (DHSC) under schemes to control NHS spending on branded medicines.
- BIL claimed these payments should reduce the VAT consideration for their pharmaceutical supplies, but HMRC rejected this.
- The First-tier Tribunal initially sided with BIL, but the Upper Tribunal overturned this decision.
- The Upper Tribunal ruled that the payments were not linked to specific supplies and did not reduce the consideration for VAT purposes, as DHSC was not part of the supply chain.
- HMRC’s appeal was allowed, except for a limited number of payments related to medicines supplied directly to DHSC.
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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