Revenue and Customs Brief 12/2015 covers the VAT liability of verandas sold with caravans in light of the Upper Tribunal’s decision in Colaingrove v HMRC that the sale of a static caravan with a veranda is a single supply for VAT purposes.
Revenue and Customs Brief 12/2015 covers the VAT liability of verandas sold with caravans in light of the Upper Tribunal’s decision in Colaingrove v HMRC that the sale of a static caravan with a veranda is a single supply for VAT purposes.
As a result, HMRC accept that verandas and decking structures sold with static caravans are to be treated as a single supply. The VAT liability of the veranda is therefore the same as that of the caravan and Notice 701/20: caravans and houseboats will be updated to reflect this change.
By way of background, supplies of static caravans, excluding removable contents, are reduced or zero-rated for VAT purposes. HMRC considered the supply of an optional veranda to be a separate standard-rated supply. Colaingrove Ltd argued that it was making a single supply of a caravan with a veranda and, because the veranda was ancillary to the caravan, it should receive the same VAT treatment.
The First Tier Tribunal decided that there was a separate supply of the veranda which was subject to VAT at the standard rate, but the Upper Tribunal reversed that decision.
