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Light in the tunnel
Key points
- The European Court of Justice case of Card Protection Plan Ltd (C-349/96) [1999] STC 270 did not clarify mixed supplies.
- The tribunal in Europcar concerning car hire and child seats ruled that the two supplies were ‘economically distinct’.
- Importance of whether one of the supplies in a mixed supply is optional.
- The GAP First-tier Tribunal case has provided some certainty.
VAT and mixed supplies: how can one topic cause so much confusion and debate and – almost certainly – incorrect VAT accounting by thousands of UK businesses? The timing of this article is appropriate for two reasons. Firstly there has been a recent First-tier Tribunal (FTT) victory for the taxpayer about whether fuel subject to 5% VAT was a separate supply to the hire of plant and vehicles. And secondly it is 25 years since the European Court of Justice gave its landmark ruling in Card Protection...
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