United Kingdom Tax Tribunal Clarifies VAT Recovery on Importation of Clinical Trial Drugs

The United Kingdom First-Tier Tribunal Jan. 14 issued a judgment in Case No. TC09749, clarifying VAT recovery on the importation of clinical trial drugs. The taxpayer, a logistics provider that imported, stored, and distributed trial drugs on behalf of mostly U.S. biopharma clients, claimed entitlement to deduct import VAT. The Tax Agency denied the claim, contending that the taxpayer didn’t own the goods, made no supply of the drugs for consideration, and couldn’t treat the import VAT as input VAT. On appeal, the Tax Tribunal found that: 1) the taxpayer acted as an agent in its own name when delivering ...