Loughborough Students’ Union v The Commissioners for HM Revenue and Customs
| Jurisdiction | UK Non-devolved |
| Judge | Judge Sinfield,Judge Sadler |
| Neutral Citation | [2013] UKUT 0517 (TCC) |
| Court | Upper Tribunal (Tax and Chancery Chamber) |
| Subject Matter | Tax,21 October 2013 |
| Date | 21 October 2013 |
| Published date | 01 December 2016 |
[2013] UKUT 0517 (TCC)
Appeal number FTC/81/2012
VAT – exemptions – cultural services – bodies managed and administered on an
essentially voluntary basis - student union governed by council – salaried sabbatical
officers of executive committee as voting then non-voting members of council -
whether FTT entitled to find student union not managed and administered on an
essentially voluntary basis – yes
VAT – exemptions – fund-raising – whether conditions of exemption that primary
purpose of events is raising of money and events promoted as primarily for raising
money necessary to ensure events not likely to cause distortion of competition – issue
remitted to FTT to determine
UPPER TRIBUNAL
TAX AND CHANCERY CHAMBER
LOUGHBOROUGH STUDENTS’ UNION Appellant
- and –
THE COMMISSIONERS FOR HER MAJESTY’S
REVENUE AND CUSTOMS Respondents
Tribunal: Judge Greg Sinfield
Judge Edward Sadler
Sitting in public in London on 30 and 31 July 2013
John Tallon QC, instructed by VATangles LLP, for the Appellant
Richard Chapman, counsel, instructed by the General Counsel and Solicitor to
HM Revenue and Customs, for the Respondents
Decision corrected on 25 November 2013 under Rule 42 of
The Tribunal Procedure (Upper Tribunal) Rules 2008
© CROWN COPYRIGHT 2013
DECISION
Introduction
1. The Appellant (“the LSU”) claimed repayment of VAT from the Respondents
("HMRC"). The LSU maintained that, in VAT periods ending January 2002 to July
2008, it had accounted for output tax on certain supplies which should have been 5 treated as exempt. The LSU’s primary claim was that supplies of the right of
admission to entertainment events were exempt under Item 2(b) of Group 13 of
Schedule 9 to the VAT Act 1994 (“the Cultural Services Exemption”). The LSU also
made an alternative claim that supplies of goods and services in connection with
certain fund-raising events, namely the annual Freshers’ Ball and Graduation Ball, 10 organised by the LSU were exempt under Article 13A(1)(o) of Directive 77/388/EEC
(“the Sixth VAT Directive”), later Article 132(1)(o) of Council Directive
2006/112/EC (“the Principal VAT Directive”), (“the Fund-raising Exemption”).
2. HMRC refused to make any repayment to the LSU. The LSU appealed to the
First-tier Tribunal ("the FTT"). 15
3. In a decision released on 8 May 2012, [2012] UKFTT 331 (TC), the FTT (Judge
Richard Barlow) dismissed the LSU’s appeal. The FTT held that the Cultural
Services Exemption did not apply because the LSU did not meet the condition that it
should be managed and administered on an essentially voluntary basis. The FTT
reached that conclusion because it found that the Council of the LSU took decisions 20 of last resort concerning the policy of the LSU and that nine sabbatical officers of the
LSU executive committee (who were members of the Council and who were paid a
salary) played a large part in the LSU Council’s decision-taking.
4. The FTT also held that the Fund-raising Exemption did not apply because the
evidence did not show that the Balls met the conditions in Item 1(b) and (c) of Group 25 12 of Schedule 9 to the VAT Act 1994, namely that their primary purpose was the
raising of money and they were promoted as being primarily for the raising of money.
5. The LSU now appeals to the Upper Tribunal on the grounds that the FTT erred
in law
(1) in relation to the Cultural Services Exemption, in that it 30
35
40
(a) failed to take account, or take sufficient account, of certain facts
established in evidence and made findings against the weight of the
evidence; and
(b) concentrated on the influence of the sabbatical officers on the LSU
Council rather than their role in the actual decisions made by the Council.
(2) in relation to the Fund-raising Exemption, in that it
(a) based its conclusion solely on the provisions of Item 1 of Group 12
of Schedule 9 to the VAT Act 1994; and
(b) failed to address the LSU’s argument that conditions in Item 1 of
Group 12, relating to primary purpose, were ultra vires the directly
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