United Kingdom Supreme Court Explains VAT Exemption for Loan Administration Services

The United Kingdom Supreme Court Oct. 11 explained the scope of VAT exemption for loan administration services. The taxpayer provided comprehensive post-loan administration services, managing tasks such as direct debits and defaults for a lender originating new loans. The taxpayer claimed that its diverse services formed a single supply of exempt payment processing, because its payments are carried out through the bankers’ automated clearing system (BACS). The Tax Agency argued, stating that the services didn’t meet the criteria for the payment exemption and the taxpayer has a limited role in passing payment information to BACS without effecting legal and financial ...