Contents
Into The Unknown
Season Of Goodwill
Farewell Andre
Toon Done Doon
Day Of Reckoning
Artistic Licence
Gizmos Again
A Free Lunch
Sweet As Nectar
Security Concerns
Going For A Spin
The Cap Does Not Fit
While It's Hot?
Code Cracking
Bad Connection
Broken Trusts
You Can't Take It With You
Dividend Returns
IR35 RIP?
Spam Spam Spam
Breaking Up
Duty Calls
Time Shift
Moving Vans
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Nectar loyalty cards and points are used in quite a few businesses. You can earn points in one shop and redeem them in another. In the middle is a company called Loyalty Management which organises the scheme - shops buy points so they can give them to their customers; and when other shops honour the points, Loyalty Management pays for the goods or services that the redeeming shop provides. Customs have recently won a VAT case about this. The company claimed back the VAT charged by the redeeming shop, saying that it had bought the goods or services as part of its business and it should be entitled to the VAT. Customs successfully argued that it was paying for goods and services that were actually supplied to someone else - the cardholder - and the VAT was not the company's to claim. That's a bit harsh, and they may appeal: when they sell points, the whole consideration is VATable, and the cost of redeeming points seems to be absolutely related to that. If the VAT isn't allowed on redemption, the system seems to collect more VAT than is fair. But the European Court ruled a few years ago that promotional schemes can have this unfortunate result. Promotional schemes are often complicated for VAT - there are different rules for vouchers, gifts, discounts, multiple supplies. If you want to run a promotional scheme and would like to discuss it first, we will be happy to help.  |