Supreme Court Rules VAT Chargeable on Performance Fees After VAT Group Exit

The Supreme Court ruled that Silverfleet Capital Ltd must charge VAT on performance-related fees received after leaving the Prudential VAT group. Although Silverfleet provided services before leaving the group, VAT is chargeable based on when the payment was invoiced or made, not when services were performed. This aligns with Regulation 90 of the 1995 VAT Regulations and the EU Principal VAT Directive, which treat continuous supplies of services as separately supplied at the time of payment or invoicing. The ruling supports HMRC’s stance and emphasizes fiscal neutrality within corporate groups.

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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