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Online commissions

01 June 2009
Issue: 4208 / Categories: Tax cases , VAT Services v CRC; CRC v Trader Media Group Ltd, Chancery Division, 15 May 2009

Two appeals concerned internet-based insurance commissions. In Trader Media Group Ltd HMRC appealed against the VAT tribunal decision allowing the company’s appeal against HMRC’s ruling that its supplies of services were outside the exemption contained in VATA 1994 Sch 9 Group 2 item 4.

In the second appeal Services appealed against the tribunal’s decision dismissing its appeal against a similar decision of HMRC.

In each case the taxpayer companies provided electronic introductory services for customers looking for insurers. If the customer subsequently took out an insurance contract commission was paid to the taxpayer company concerned.

The appeals raised a preliminary issue as to whether the act of introduction was enough to make the introducer an insurance agent or broker. HMRC argued that the taxpayer companies were maintaining a website through which customers could reach insurers.


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