David Baxendale Ltd v HM Revenue and Customs [2009] EWCA Civ 831 (31 July 2009)

David Baxendale Ltd v HM Revenue and Customs [2009] EWCA Civ 831 (31 July 2009)

The Court of Appeal held that the LighterLife programme, as supplied by David Baxendale Limited, constituted a single composite supply of standard-rated services for VAT purposes. The supply was economically indivisible from the perspective of the typical consumer, who sought the combined benefit of both the food...

Source-derived case information.

Citation
[2009] EWCA Civ 831
Parties
Appellant: David Baxendale Limited; Respondents: The Commissioners for Her Majesty's Revenue and Customs
Jurisdiction
England and Wales
Judgment Date
31 July 2009
Procedural Posture
Civil Appeal / Court of Appeal Judgment on Appeal From High Court
Outcome
Appeal dismissed
Legal Topics
Value Added Tax (vat), Composite and Multiple Supplies, Zero Rating, Standard Rated Supplies, Interpretation of Sixth Directive, Apportionment of Consideration
Tax Law European Union Law Value Added Tax (vat) Composite and Multiple Supplies Zero Rating Standard Rated Supplies Interpretation of Sixth Directive Apportionment of Consideration

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Summary, issues, holding and outcome

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Parties

David Baxendale Limited

Appellant

The Commissioners for Her Majesty's Revenue and Customs

Respondents

Procedural Posture

Civil Appeal / Court of Appeal Judgment on Appeal From High Court

Legal Issues

  1. 1 Whether the LighterLife weight loss programme constitutes a single composite supply or multiple supplies for VAT purposes
  2. 2 Whether the supply should be zero-rated (food) or standard-rated (services)
  3. 3 Correct apportionment of consideration if multiple supplies

Ratio Decidendi

The Court of Appeal held that the LighterLife programme, as supplied by David Baxendale Limited, constituted a single composite supply of standard-rated services for VAT purposes. The supply was economically indivisible from the perspective of the typical consumer, who sought the combined benefit of both the food packs and the counselling/support services as an integrated weight loss programme. It would be artificial to split the transaction into separate supplies for VAT purposes. The appeal was dismissed and the High Court's decision upheld.

Court Disposition

Appeal dismissed

Orders

  • The decision of the High Court (Morgan J) is affirmed.
  • The supply by David Baxendale Limited is to be treated as a single composite supply of standard-rated services for VAT purposes.