The VAT review for March 2023

This month’s VAT review covers the recovery of input VAT by a holding company on the basis of the target’s taxable activities. The claim in Ince Gordon Dadds LLP failed, but the FTT considered whether the fundraising aspects of the transaction were attributable to the downstream taxable activities of the group. The Isle of Wight NHS Trust case concerns HMRC’s inadvertent provision of an appealable decision through informal rejection of the arguments put forward by the recipients of a supply that HMRC’s declared VAT treatment of such supplies is incorrect. And finally, the FTT in Pavan Trading Ltd rejected HMRC’s interpretation of its own VAT notice and held that evidence of export merely needs to be in the possession of the exporter within three months of the export and not supplied to HMRC within that period.