International cases update – February 2012

In February 2012 the following VAT decisions were handed down in the UK and the ECJ (some of the First Tier Tribunal decisions were handed down in January 2012 but were only recently published).  My research did not disclose any decision of note in New Zealand or Canada.

The most interesting decisions were Aberdeen Sports Village (VAT on financial assistance payments) and David Peters (whether goods not delivered were nevertheless supplied).  I have already published my thoughts on these decisions.

Upper Tribunal

  • Powa (Jersey) Ltd v HMRC [2012] UKUT 50 – VALUE ADDED TAX – input tax – MTIC and contra-trading – whether connection to fraudulent trading as condition of denial of right to deduct input tax requires privity of contract with fraudulent trader – test in Kittel and Recolta Recycling – whether English mistranslation of French text of the judgment – whether to refer question to ECJ – application of Court of Appeal judgment in Mobilx

First Tier Tribunal

European Court of Justice

  • Eon Aset Menidjmunt [2012] EUECJ C-118/1 – VAT – Directive 2006/112/EC – Articles 168 and 176 – Right of deduction – Condition relating to use of goods and services for the purposes of taxed transactions – Origin of the right to deduct – Motor vehicle leasing contract – Financial leasing contract – Vehicle used by employer to transport free of charge an employee between his home and his workplace
  • Van Laarhoven [2012] EUECJ C-594/10 – Sixth VAT Directive – Right to deduct input tax – Limitation – Use of goods forming part of the assets of a business for the private use of the taxable person – Fiscal treatment of private use of goods that are assets of the business
  • Varzim Sol [2012] EUECJ C-25/11 – Sixth VAT Directive – Deduction of input tax – Article 17(2) and (5) and Article 19 – ‘Subsidies’ used for the purchase of goods and services – Restriction of the right to deduct

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