Supplies of goods to customers fraudulently using a bank card are subject to VAT where the card provider pays for those goods
By Michael Cant
The Court of Justice of the European Union (CJEU) has ruled in the case of Dixons Retail plc v Commissioners (C-494/12) that a supplier must account for output VAT on payments received from third-party card providers for supplies made to customers who bought goods using a fraudulent card.
It should be noted that this decision: turned on the specific facts of the case — in particular the fact that Dixons had agreements with card issuers under which the issuers agreed to pay Dixons for all transactions made with their cards, provided Dixons followed set procedures; means retailers will not be able to recover any output VAT already accounted for in respect of payments received from card providers for goods bought using fraudulent cards; and does not come as a big surprise given the decisions in Loyalty Management UK and Redrow Group, which held that payment by a third party to a supplier for goods or services supplied to a customer could amount to ‘third-party consideration’ for VAT purposes…
Click on the link below to read the rest of the Nabarro briefing.
News from Nabarro
News from The Lawyer
Briefings from Nabarro
Non-Chinese contractors are regularly encountering contracts containing arbitration clauses providing for disputes to be determined by Chinese arbitration centres.
This note provides a short summary of the two formal insolvent liquidation processes.
Analysis from The Lawyer
Nabarro senior partner and self-confessed “IT geek” Graham Stedman is heralding a major set of investments in technology ahead of the firm’s move to 125 London Wall this year.
Clients are more willing to bring claims against professional service providers but the risk to defendants is not as dramatic as it might seem