EC consultation on e-commerce payment rules
The Commission recently launched a public consultation on the impact of the new place of supply rules on e-commerce transactions. Legislative proposals will be introduced in 2016 once the consultation findings have been evaluated.
The EC is keen to introduce a threshold that would exempt smaller businesses from having to use the new MOSS scheme to account for intra EC e-commerce transactions.
This is partly a reaction to concerns voiced by small businesses, particularly those in the UK, that were until now not required to register for VAT because they traded under the UK VAT turnover threshold.
VAT Groups - treatment of overseas branches
HMRC have issued Revenue and Customs Brief 18/15 to clarify their position on the treatment of intra group transactions involving branches located in other member states following the judgment in Skandia.
Sweden and other EC member states treat the 'resident' branch of an overseas company as a separate taxable person even where that branch is VAT grouped with entities in that particular member state.
This means that, in some member states, supplies between an overseas company and a group which includes the overseas company's branch cannot be treated as intra-group transactions for VAT purposes.
The UK interprets VAT grouping on a 'whole entity' basis and as such the impact will not be felt where a group including the UK branch of an overseas company buys services from that company.
Update on Sporting Services (Golf club) claims
HMRC have published Revenue and Customs Brief 19/2015 which sets out their requirements for the consideration of claims by sporting members' clubs for VAT overpaid on certain supplies including Green Fees.
It appears HMRC are hoping that clubs will drop their claims for further VAT restricted under the unjust enrichment rationale if they are offered a sweetener now.
Bad debts and Insolvency Practitioners - ESC 3.20 withdrawal
ESC 3.20 ensures that Insolvency Practitioners don't become liable to repay VAT claimed as input tax in cases where an insolvent business has not paid for pre-appointment supplies.
The Treasury is seeking to make this ESC law following the Wilkinson judgment which questioned the appropriateness of many of the ESCs currently permitted by HMRC.
A consultation is currently ongoing in respect of a number of ESCs. Full details can be found by clicking the links below.