The University Of Huddersfield Higher Education Corporation v Revenue & Customs (VAT-input tax-abuse of rights) [2013] UKFTT 429 (TC) (29 April 2013)

The University Of Huddersfield Higher Education Corporation v Revenue & Customs (VAT-input tax-abuse of rights) [2013] UKFTT 429 (TC) (29 April 2013)

The University’s lease/leaseback arrangements did not constitute an abuse of rights under EU VAT law because no absolute tax saving accrued at the time of assessment; any tax advantage was balanced by output tax liability and was consistent with both domestic and EU law. Redefinition of the transactions was not...

Source-derived case information.

Citation
[2013] UKFTT 429
Parties
Respondent: HMRC; Appellant: The University
Jurisdiction
United Kingdom
Judgment Date
29 April 2013
Procedural Posture
Tax Appeal / First Tier Tribunal (tax Chamber) Judgment
Outcome
Appeal allowed
Legal Topics
VAT, Abuse of Rights, Input Tax Deduction, Lease/leaseback Arrangements, Anti Avoidance, Redefinition of Transactions
Tax Law European Union Law VAT Abuse of Rights Input Tax Deduction Lease/leaseback Arrangements Anti Avoidance Redefinition of Transactions

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Summary, issues, holding and outcome

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Parties

HMRC

Respondent

The University

Appellant

Procedural Posture

Tax Appeal / First Tier Tribunal (tax Chamber) Judgment

Legal Issues

  1. 1 Whether the University’s lease/leaseback arrangements constituted an abuse of rights under EU VAT law
  2. 2 Whether the upfront deduction of input tax was a tax advantage contrary to the purposes of the VAT regime
  3. 3 Whether the national anti-avoidance rules were consistent with EU law

Ratio Decidendi

The University’s lease/leaseback arrangements did not constitute an abuse of rights under EU VAT law because no absolute tax saving accrued at the time of assessment; any tax advantage was balanced by output tax liability and was consistent with both domestic and EU law. Redefinition of the transactions was not justified as no specific abusive element was identified. The appeal is allowed.

Court Disposition

Appeal allowed

Orders

  • Assessment by HMRC is set aside
  • No redefinition of transactions is required