TaxSource Total

Here you can access summary of the key current tax developments in Ireland, the UK and internationally as reported by Chartered Accountants Ireland

The report of key tax developments are displayed per year, per month, by Ireland, the UK or International and by report title

Review of VAT grouping

Brief 3 of 2016 announces the Government’s intention to launch a consultation on VAT grouping provisions and highlights the planned approach.

The Brief notes that in the CJEU Larentia and Minerva decisions, Member States may only restrict VAT grouping to legal persons, where those restrictions are appropriate and necessary in order to prevent, abuse, avoidance or evasion. The Brief adds that the Government expects to make changes to UK law and VAT grouping provisions.

These changes are likely to include:

  • extending VAT grouping to non-corporate bodies; and
  • identifying new rules to determine ‘close economic, financial and organisational’ links for corporate and non-corporate bodies, replacing the current “control” test based on a company law definition of a subsidiary.

HMRC will also use this opportunity to find out what businesses and their representatives think about other grouping related matters, particularly those where the provisions differ across EU member states, as identified in the Skandia case.

The time-line for the proposals is also outlined with a formal consultation to be launched in Spring 2016.