Leisure, Independence, Friendship and Enablement Services Ltd v HMRC; and Learning Centre (Romford) Ltd v HMRC

In Leisure Independence Friendship and Enablement Services Ltd v HMRC; and Learning Centre (Romford) Ltd v HMRC [2020] EWCA Civ 452 the Court of Appeal held that the welfare services exemption did not extend to adult day-care services provided by two private companies.

Leisure Independence Friendship And Enablement Services Ltd (LIFE) and The Learning Centre (Romford) Ltd (TLC) were for-profit companies providing day-care services. LIFE provided care services for adults with a spectrum of disabilities. TLC similarly provided day-care to vulnerable adults with learning difficulties. Both companies believed their services were exempt from VAT.

Under UK law (VATA 1994 Sch 9 Group 7 Item 9) the welfare exemption is limited to supplies by charities state-regulated private welfare institutions or agencies and public bodies. LIFE argued that it was state-regulated and therefore qualified for exemption. Both companies argued the UK’s welfare exemption violated the principle of fiscal...