Wednesday 18 February 2015

Supply of commercial research: Imperial College VAT recovery claim upheld

This blogger will not even pretend to understand the subtleties of Imperial College of Science, Technology & Medicine v Revenue & Customs [2015] UKFTT 0033 (TC), a United Kingdom First-Tier Tax Tribunal decision of 22 January 2015 which has recently come to his attention. Is looks, however, as though it might be of interest to the research and development side of the British IP sector, since it involves a claim for repayment of Value Added Tax that had been paid by leading academic research institution Imperial College, London, as long ago as 1973 and as recently -- if that be the right word -- as 1994. According to the short summary in the subscription-only Lawtel note,
The Revenue had approved a retrospective partial exemption special method with a university outside its agreement with the Committee of Vice-Chancellors and Principals Guidelines regarding interpretation of the law concerning VAT within the university context. The exemption method was in respect of claims for repayment of residual input tax as a proportion of overhead costs incurred by the university's academic departments on the supply of commercial research. The approval was not ultra vires and the Revenue was bound by the exemption method to repay the university's claim, subject to the university satisfying the appropriate evidential burden.
Knowing how precious is any sort of revenue to research institutions, this blogger wonders whether other colleges may also be able to avail themselves of this ruling, or whether it is so fact-specific to Imperial that it will be of little assistance to anyone else.

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