Vincent Consultants Ltd
| Jurisdiction | UK Non-devolved |
| Judgment Date | 23 September 1988 |
| Date | 23 September 1988 |
| Court | Value Added Tax Tribunal |
VAT Tribunal
The following cases were referred to in the decision:
Berkholz v. Finanzamt Hamburg-Mitte - Altstadt VATUNK(1985) 2 BVC 200,178; [1985] 3 C.M.L.R. 667
Binder Hamlyn VAT(1983) 1 BVC 1190; (1983) VATTR 171
Fixed establishment - Whether registered office from which no trade carried on was a fixed establishment - Whether UK or Swiss establishment place where services most directly to be used - Sixth Directive, Art. 9 - Value Added Tax Act 1983 section 8 subsec-or-para (2) schedule 5 group 9Value Added Tax Act 1983, sec. 8(2), Sch. 5, Grp. 9, item 6.
The issue was whether the appellant's services to many different companies were standard or zero-rated, depending on whether the companies belonged in a country which was not a member State of the European Community (EC).
The appellant company (V) provided financial and administrative advice to clients, many of whom were foreign individuals or companies, who had a branch in the UK. It appealed against an assessment to VAT, the Commissioners alleging that it should have charged VAT at the standard rate. V argued that the services were zero-rated.
V's arguments depended upon whether the services fell within the Value Added Tax Act 1983, Value Added Tax Act 1983 schedule 5 group 9Sch. 5, particularly Grp. 9, item 6, which referred to supplies to a person who belonged to a country which was not a member State of the EC. V provided services mainly to branches of Italian companies trading from Switzerland, but incorporated and registered in the UK, their registered office being the address of the appellant company, with the exception of two in Edinburgh. This was done to avoid Swiss tax. The companies had no employees in England and the directors and shareholders were resident abroad. V kept the books, helping the companies to comply with their UK statutory duties and the presentation of accounts while employees of V were the companies' secretaries.Value Added Tax Act 1983 section 8 subsec-or-para (2)Section 8(2) determined that if a company had an establishment where the services were to be most directly used then they were to be treated as belonging to the country where that establishment was.
The appellant contended that under the Sixth Directive, Art. 9 a supply of service took place where the recipient of that supply had a fixed establishment to which the service was supplied, and that the registered office of the companies was not a fixed establishment, as it did not have the human and technical resources necessary for carrying on a business.
Held, dismissing the company's appeal:
1. There was a distinction between what was necessary to constitute a fixed establishment for a supplier of a service and for a recipient of a service. Thus, a registered office might not be a place from which services could be supplied, while remaining a place to which services could be supplied.
2. "Establishment" was an ordinary English word, and embraced an organisation, such as a registered office, which could receive, inter alia, writs and other legal documents.
3. V provided its services to the companies at their registered offices in the UK, and the companies received them by their company secretaries. It was immaterial that those company secretaries were members of V. Accordingly, each of the companies had a fixed establishment in both Switzerland and the UK.
4. To avoid paying Swiss taxes the...
To continue reading
Request your trial
-
British United Provident Association Ltd v Commissioners of Customs and Excise
...Leasing Ltd VATNo. 15,719; [1999] BVC 2032 Singer & Friedlander Ltd VATNo. 3274; (1989) 4 BVC 512 Vincent Consultants Ltd VATNo. 3091; (1988) 3 BVC 808 WT Ramsay Ltd v IR Commrs ELR[1982] AC 300 Place of supply of services - Whether company established in Guernsey was a "customer" for suppl......
-
WH Payne & Company
...Jernverks AktiebolagELR[1914] 1 KB 715 R v Bouchereau (Case 30/77) [1977] ECR 1999 Vincent Consultants Ltd VAT(LON/88/254) No. 3091; (1988) 3 BVC 808 Supply - Services - Place of supply - Where recipient belonged - Services of accountants supplied to customer established outside EU - Custom......
-
Singer & Friedlander Ltd
...v VAT(1976) 1 BVC 84 IR Commrs v Brackett & related appeals TAX[1986] BTC 415 Re MacManaway ELR[1951] AC 161 Vincent Consultants Ltd VAT(1988) 3 BVC 808; (LON/88/254) No. 3091 Assessment - Supplies to overseas persons - Whether supplies made to persons belonging outside the UK and EC - Whet......