- Nissi N Nissi Ltd lost its appeal against HMRC, which denied input VAT relief on property used as a children’s nursery.
- The tribunal agreed with HMRC that the supplies related to the property were not taxable, so the option to tax was disapplied.
- Anti-avoidance rules under VATA 1994 applied because the land was intended for exempt use (childcare), and the development financier (SSN) was not a taxable person.
- Arguments that the rules only applied to large financial institutions or that SSN’s contributions were minimal were rejected.
- The tribunal concluded that the anti-avoidance provisions applied, so input VAT could not be recovered.
Source: claritaxnews.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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