On 29 July 2010 the European Court of Justice (ECJ) delivered a judgment against Astra Zeneca which may mean employers will face the prospect of paying VAt to the taxman on goods or services provided to employees under salary sacrifice schemes.

In 2010 the Coalition Government introduced the concept of RTI. It means a significant change to PAYE for employers who will have to report each employee's pay, tax, NIC and other deductions in advance of each normal pay interval. For each payroll, that could mean 12 monthly or 52 weekly returns to be done rather than one annual reconciliation as at present.

The widely trailed ‘VAT package’ was introduced on 1 January 2010 bringing about major changes to the way VAT applies to cross
border transactions. Now that the new rules are bedding in, it is worth considering what they mean in practice.

There are over one million properties in Spain owned by Brits, making it the most popular destination for UK residents acquiring foreign property. As investors in the current economic climate look out for any bargains to be had overseas this number may increase.

This Alert is a reminder that the standard rate of VAT will increase to 20% with effect from 4 January 2011. The reduced rate (5%), the zero rate and VAT exemptions are not affected by the change.

It was announced in this year's Budget that the Royal Mail could no longer be exempt from the effects of VAT following a European Court devision in the case of TNT.  Mainstream services will not be affected but VAT will apply from 31 January 2011 to many special services....

Following a Tribunal decision in the case of BAA plc earlier this year, an opportunity has arisen for businesses to submit claims for VAT on fees incurred in the course of corporate deals and acquisitions....

HMRC have issued RCB 21/10 which sets out a measure to allow businesses to continue to claim VAT on hotel bills where the hotels are booked through an agent....

VAT NOT PAYABLE ON SAMPLES

The European Court has delivered its judgement in the case of EMI plc concerning the liability to VAT of samples, e.g. audio CDs.  EMI took the view that the CDs, which were identified as samples, were not gifts on which VAT was due but were normal promotional costs of operating their business.  HMRC disagreed and applied the rules for gifts and samples which resulted in a VAT charge.  After much legal wrangling - which commenced in 2003! - the final decision has been delivered in EMI's favour resulting in a claim in excess of £3.3M.