Longridge On the Thames v Revenue And Customs

Longridge On the Thames v Revenue And Customs

Longridge’s activities constituted economic activity for VAT purposes because they were permanent, involved the supply of services for consideration, and there was a direct link between the charges and the services provided. The objective nature of the activity, not the charitable motive, use of volunteers, or concessionary pricing, determines economic activity. The FTT and Upper Tribunal erred in law by applying domestic criteria inconsistent with CJEU jurisprudence. The construction services were not zero-rated as the building was intended for use in the course or furtherance of a business.

Parties
Respondent: Longridge on the Thames; Appellants: The Commissioners for Her Majesty’s Revenue and Customs
Jurisdiction
England and Wales
Judgment Date
01 September 2016
Procedural Posture
Civil Appeal (tax and Chancery) / Appeal From Upper Tribunal to Court of Appeal
Outcome
Appeal allowed. Decision of Upper Tribunal and FTT set aside.
Legal Topics
Value Added Tax (vat), Economic Activity Definition, Charitable Purposes, Zero Rating of Construction Services
Tax Law Charity Law European Union Law Value Added Tax (vat) Economic Activity Definition Charitable Purposes Zero Rating of Construction Services

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 3 Authorities cited 28 Party arguments 2 Amounts and remedies 2
Sign in to unlock

Parties

Longridge on the Thames

Respondent

The Commissioners for Her Majesty’s Revenue and Customs

Appellants

Procedural Posture

Civil Appeal (tax and Chancery) / Appeal From Upper Tribunal to Court of Appeal

Legal Issues

  1. 1 Whether Longridge’s activities amount to economic activity for VAT purposes under Article 9 of the Principal VAT Directive and VATA 1994.
  2. 2 Whether the supply of services in the construction of a building for Longridge should be zero-rated as intended for relevant charitable purposes.

Ratio Decidendi

Longridge’s activities constituted economic activity for VAT purposes because they were permanent, involved the supply of services for consideration, and there was a direct link between the charges and the services provided. The objective nature of the activity, not the charitable motive, use of volunteers, or concessionary pricing, determines economic activity. The FTT and Upper Tribunal erred in law by applying domestic criteria inconsistent with CJEU jurisprudence. The construction services were not zero-rated as the building was intended for use in the course or furtherance of a business.

Court Disposition

Appeal allowed. Decision of Upper Tribunal and FTT set aside.

Orders

  • HMRC’s appeal allowed.
  • Longridge’s activities held to be economic activity for VAT purposes.