Taxation logo taxation mission text

Since 1927 the leading authority on tax law, practice and administration

Link between production costs and supplies of catering

28 June 2021
Issue: 4798 / Categories: Tax cases
Royal Opera House Covent Garden Foundation v CRC, Court of Appeal, 17 June 2021

The Royal Opera House was a charity so income from sales of tickets for opera and ballet performances were exempt from VAT. It also offered taxable supplies of catering facilities. The dispute was whether VAT should be recoverable on a proportion of production costs.

HMRC considered the only direct and immediate link of the production costs was with the sale of tickets so that it was not possible to recover the input tax. The foundation said there was a direct and immediate link with the ticket sales and the supply of catering services and therefore an apportionment was required.

The First-tier Tribunal found in favour of the taxpayer holding that catering services were economically linked to the production costs. The Upper Tribunal allowed HMRC’s appeal saying there was an indirect link economically between the production costs and the catering supplies but it was not enough to be direct...

Only subscribers may read the full article

Alternatively, you can register free of charge to read a limited amount of subscriber content per month.
Once you have registered, you will receive an email directing you back to read this item in full.
back to top icon