It is often easy to get VAT law wrong. Both parties to a transaction, each registered for VAT, take good advice and consider that a supply made for both sides’ business purposes is exempt. No VAT is charged or accounted for and no VAT invoice is issued. But, a year or two later, a court decides that the supply is standard-rated.
Unpicking the consequences of such mistakes has generated a rich seam of case-law, of which the Court of Appeal’s judgment in Zipvit (a single judgment given by Henderson LJ) is the latest instalment. The effect of Zipvit is that the key requirement is a VAT invoice, and without that, the purchaser is in trouble.
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The comments made in this case note are wholly personal and do not reflect the views of any other members of Monckton Chambers, its tenants or clients.
This case note was first featured in the August 2018 issue of De Voil.