V5.213G Designated schemes

The following schemes are designated schemes for the purpose of VATA 1994, Sch 11A1. A scheme is regarded as fitting a description below even if any feature of that scheme is not actually present, provided a taxable person has treated it as being present for the purpose of making a return or claim for repayment of output tax or an increase in input tax credit2. HMRC explains this provision as follows3:

'If, for the purpose of making a return, a taxable person treats the transaction as being such a supply, then the feature is regarded as being present (for the purposes of deciding whether disclosure is required), even if it is subsequently found, say by the Courts, that there has been no supply as a matter of law.'

First grant of a major interest in a building

Any scheme comprising or including the first grant of a major interest in any building of a description falling within VATA 1994, Sch 8, Group 5 item 1(a) (construction of buildings etc) where:


    •     the grant is made to a person connected with the grantor, and


    •     the grantor, or any body corporate treated as a member of a VAT group under VATA 1994, s 43 of which the grantor is a member, attributes to that grant input tax incurred by him:


      –     in respect of a service charge relating to the building, or


      –     in connection with any extension, enlargement, repair, maintenance or refurbishment of the building, other than for

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