First Senior Accounting Officer ‘main duty’ decision: greater clarity on ‘reasonable steps’
Global Tax Update: September 2017 / United Kingdom
This UK newsletter explains 3 topics including " First Senior Accounting Officer ‘main duty’ decision: greater clarity on ‘reasonable steps’ ". (Global Tax Update:September 2017/United Kingdom)
1. First Senior Accounting Officer ‘main duty’ decision: greater clarity on ‘reasonable steps’
The First-tier Tribunal has allowed an appeal against a Senior Accounting Officer (SAO) main duty penalty for financial years 2012 and 2013 where the SAO was the finance director of a privately owned group. HMRC had imposed the penalties on the previous SAO of the group as a result of an error correction notice filed by its advisors in 2014 in relation to VAT returns estimating an overall net error of £1.36m.
2. VAT: Temple Retail: value of recharges between associated companies: Upper Tribunal
Temple Retail Ltd and Temple Finance Ltd are part of the PerfectHome group, which sells goods on hire purchase to credit-constrained customers. Temple Retail (which is fully taxable) recharged 20% of the group’s advertising and premises costs to Temple Finance (which is a partially exempt finance house). The Upper Tribunal has rejected HMRC’s arguments that a greater share of the expenses should have been recharged to the partially exempt company, which should in turn have applied a less generous partial exemption method.
3. VAT exemption and platform services: First-tier Tribunal
The First-tier Tribunal has published its decision in the case of Blackrock Investment Management (UK) Ltd, concerning whether the supply of an electronic investment management platform called ‘Aladdin’ was exempt from VAT on the basis that it constituted the management of a special investment fund (SIF).