Associated Newspapers Limitied v The Commissioners for Her Majesty's Revenue & Customs, TC 04586
| Jurisdiction | UK Non-devolved |
| Judge | Kevin POOLE |
| Judgment Date | 13 August 2015 |
| Neutral Citation | [2015] UKFTT 0409 (TC) |
| Respondent | The Commissioners for Her Majesty's Revenue & Customs |
| Appellant | Associated Newspapers Limitied |
| Reference | TC 04586 |
| Court | First-tier Tribunal (Tax Chamber) |
[2015] UKFTT 0409 (TC)
TC04586
Appeal number: TC/2014/06561
TC/2015/00081
TC/2015/02402
TC/2015/02967
TC/2015/03546
VAT – Retailer Vouchers – Schedule 10A VATA – purchase by appellant both direct from
retailers and from intermediate supplier – whether any input VAT arising on purchases direct
from retailers – whether input VAT (either on direct or intermediary purchases) recoverable
by appellant – appeal allowed in principle
FIRST-TIER TRIBUNAL
TAX CHAMBER
ASSOCIATED NEWSPAPERS LIMITED Appellant
-and-
THE COMMISSIONERS FOR HER MAJESTY’S
REVENUE AND CUSTOMS Respondents
TRIBUNAL: JUDGE KEVIN POOLE
Sitting in public in The Royal Courts of Justice, London on 7, 8 & 9 July 2015
John Walters QC, instructed by KPMG LLP for the Appellant
Kieron Beal QC and Simon Pritchard of counsel, instructed by the General Counsel
and Solicitor to HM Revenue and Customs, for the Respondents
© CROWN COPYRIGHT 2015
2
DECISION
Introduction
1. This appeal is closely related to an earlier appeal between the same parties, in
respect of which a decision of this Tribunal was issued on 24 January 2014 under 5 reference [2014] UKFTT 116 (TC).
2. Both appeals concern the VAT treatment of certain retailer vouchers
distributed by the appellant as part of its sales promotion efforts for its newspapers.
The earlier appeal (“ANL(1)”) was concerned with the output tax liability of the
appellant in respect of its distribution of the vouchers to its customers. This appeal is 10 concerned with its recovery of input tax on its purchase of the vouchers.
The facts
3. I received witness statements from James Welsh, Finance and Operations
Director of DMG Media Limited (of which the appellant is a subsidiary) and Philip
Ross, Indirect Tax Compliance Manager of the appellant. Both also gave live 15 evidence to supplement their witness statements.
4. The parties had also agreed a “Statement of Facts not in Dispute” as follows:
“1. The Appellant publishes the Daily Mail and the Mail on Sunday
newspapers.
2. During the period from 2007 to 2010, it ran a series of 20 promotions under an initiative which it called “SPICE” (Sales
Performance Improvement by Circulation Excellence).
3. Through mailshots to addresses where it was believed the
occupiers already took home delivery of competitor newspapers (and
later through other methods), the Appellant made a special introductory 25 offer of its own titles. The basic offer involved a 50% reduction on the
cover price of the Daily Mail and the Mail on Sunday if the customer
took them by newsagent daily delivery for a period of 12 or 13 weeks.
The customer was supplied with half price coupons which were
redeemable at the newsagent. The customer thus paid the newsagent in 30 cash for the other 50% of the price of the newspapers and also paid the
delivery charge in full. At the end of the 12 or 13 week promotional
period, the customer was legally entitled, if he had continued to take the
newspapers throughout that period, to a voucher from a high street
retailer (typically Marks & Spencer, ASDA or Sainsbury’s, at the 35 customer’s election) to a set value. At different times, the value of the
voucher offered was various amounts between £10 and £100. The
customer was contractually entitled to the voucher if he fulfilled his
commitment to purchase the paper, seven days a week, by home
delivery for the length of the promotional period. In addition, the 40 participating newsagents were also provided with a similar voucher
(typically £5 for each customer who continued throughout the
promotional period).
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