KEY POINTS
- WHA Ltd set up a 'Gibraltar loop' in claim handling to try and reclaim input tax.
- HMRC attacked under 'abuse of rights'.
- Purpose of VAT is to be fiscally neutral except for end purchaser.
- HMRC appeal allowed by House of Lords.
We do not normally take a detailed look at the larger VAT cases in Taxation these days; we leave that to our sister magazine The Tax Journal.
However the case of WHA Ltd v HMRC [2007] EWCA Civ 728 is a key VAT case on avoidance and the principles of it are relevant for businesses of any size that are contemplating doing some VAT planning.
An insurance company NIG sold motor breakdown insurance policies. If you bought one of their policies and your car subsequently broke down...
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