The Commissioners for HM Revenue and Customs v Netbusters (UK) Limited [2022] UKUT 00175 (TCC)
| Jurisdiction | UK Non-devolved |
| Judge | Judge Rupert Jones,Mr Justice Miles |
| Neutral Citation | [2022] UKUT 00175 (TCC) |
| Subject Matter | 5 July 2022 |
| Court | Upper Tribunal (Tax and Chancery Chamber) |
| Published date | 08 July 2022 |
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Neutral Citation: [2022] UKUT 00175 (TCC)
UT (Tax & Chancery) Case Number: UT/2021/000044
Upper Tribunal
(Tax and Chancery Chamber)
Hearing venue: Rolls Building, London
EC4A 1NL
Heard on: 11-12 May 2022
Judgment given on 28 June 2022
Before
MR JUSTICE MILES
JUDGE RUPERT JONES
Between
THE COMMISSIONERS FOR HER MAJESTY’S
REVENUE & CUSTOMS
Appellant and
NETBUSTERS (UK) LIMITED
Respondent
Representation:
For the Appellant: Kate Selway QC, Counsel, instructed by the General Counsel and Solicitor
to HM Revenue and Customs
For the Respondent: Michael Firth, Counsel
© CROWN COPYRIGHT 2022
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DECISION
Introduction
1. Her Majesty’s Revenue and Customs (‘HMRC’) appeal the decision of the First-tier
Tribunal (‘FTT’) dated 2 November 2020 which was released as [2020] UKFTT 438 (TC).
2. As the FTT outlined at [1] of its decision: ‘The appeal concerns the proper classification
for VAT purposes [of] the supplies made by [Netbusters]. The activities in question are the
organisation by [it] of various competitive football and netball leagues and the supply of pitches
for these league matches to be played upon.’
3. The FTT allowed the appeal of the Respondent, Netbusters (UK) Ltd (‘Netbusters’) against
decisions of HMRC: (1) to refuse to repay VAT that Netbusters contended was overdeclared
output VAT for the periods 04/13 – 10/16 in the total sum of £414,622; (2) to assess Netbusters
to pay VAT for the periods 01/17 – 07/18 totalling £218,542.
4. Netbusters organises competitive 5-a-side football and netball leagues. It hires pitches from
third parties (such as schools and local authorities) as regular series of block bookings. It then
makes these pitches available to the teams who have signed up to the league to enable them to
play their league fixtures. Netbusters manages all aspects of league administration. Typically,
a team will pay one match per week on the same evening each week and each booking will be
long enough to enable two or more matches to be played one after the other. On the larger
pitches two matches might be played at any one time.
5. The FTT decided at [35] that the services provided by Netbusters were one single
composite supply. The FTT allowed the appeal, finding that the objective character of the
supplies made by Netbusters fell within the definition of “the grant of any interest in or right
over land or of any licence to occupy land” for the purposes of Schedule 9, Group 1, Value
Added Tax Act 1994 (‘VATA 1994’) (see [37] of the decision). Thus, the supplies were exempt
from VAT.
6. HMRC appeal the FTT’s decision on the basis it was made in error of law. They were
granted permission to appeal by the Upper Tribunal to pursue five grounds of appeal which are
set out below. HMRC submit in short that the FTT should have concluded that the objective
character or economic reality of Netbusters’ supplies was not the grant of a licence to occupy
land, the hiring out of sports pitches, but, rather, was supplying competitive league sports
management services.
The FTT’s decision
7. References to numbered paragraphs in parentheses, [xx], unless stated otherwise, are
references to paragraphs in the FTT’s decision.
8. The FTT made the following findings of fact at [16] (references to the Appellant being
to Netbusters):
(1) The Appellant was registered for VAT on 15 February 2012.
(2) The Appellant enters into binding agreements with third parties, such as local authorities
and schools, to hire venues belonging to these third parties for set periods of time. It then hires
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