VAT groups and time of supply

Key points

• The dispute concerned the question whether VAT was due on the performance fee payable to a party after it had left the VAT group.
• HMRC said the time of supply had to be determined in line with reg 90(1) of the VAT Regulations SI 1995/2518.
• EU law distinguishes between the ‘chargeable event’ and the time when ‘VAT becomes chargeable’. This should have helped Prudential.
• The Court of Appeal however relied on domestic case law rather than European case law.

The issue the Court of Appeal had to deal with in Prudential Assurance Co Ltd v CRC [2024] EWCA Civ 300 was perhaps as pure a point of law as one can come across. Supplies comprising (non-exempt) fund management services had been made by a related party (Silverfleet) to the appellant (Prudential).

At the time the services were performed Silverfleet and Prudential were part of the same...