Charity’s Studio Space: No Exempt Land Supply, FTT Rules

• Sarabande is a charity that provides support to artists.
• Sarabande claimed input tax on property acquisition and refurbishment.
• HMRC disallowed the claim, arguing that Sarabande made exempt supplies of land.
• The First-tier Tribunal (FTT) upheld Sarabande’s appeal.
• HMRC argued that Sarabande made an exempt supply of land to its subsidiary, SIL.
• Sarabande argued that it made supplies directly to artists, not supplies of land.
• The FTT concluded that SIL did not acquire a contractual right to occupy the building from Sarabande.
• The FTT determined that there was no exempt supply made by Sarabande to SIL.
• The FTT concluded that Sarabande made a supply to the artists, which was not an exempt supply of land.
• The FTT determined that the supply was of a support program, with studio rental being a central element.

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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