Tax analysis: The Court of Justice of the European Union (CJEU) has held in Skandia that services provided by a US company headquarters to its Swedish branch were supplies for VAT purposes. The judgment concerned the Swedish VAT grouping rules and the result is a VAT fiction with real financial consequences, according to Tarlochan Lall, a tax lawyer and barrister at Monckton Chambers, and difficult to decode. Here, he considers whether there is inconsistency in HMRC’s conclusion that, although no change is required in UK law, Skandia will have an impact on certain businesses.
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This article was first published on Lexis®PSL Tax on 9 April 2015.