Cloud Electronic Holdings has successfully reclaimed VAT charges at a tax tribunal after being advised by us.
The tribunal ruled that Cloud Electronic Holdings could recover VAT on professional fees charged by solicitors and corporate finance advisors during a management buy-out of Cloud Electronics Ltd., of Staniforth Road, Sheffield.
The company took professional advice from us before challenging the tax authorities.
The tribunal heard that HMRC had refused Cloud Electronic Holdings’ claim for recovery of VAT because the holding company, set up to handle the buy-out, could not have incurred the costs because it hadn’t been incorporated when the deal advisors were appointed.
HMRC contended that the deal advice had been provided to the individuals buying the company and/or their financiers.
The Tribunal concluded that the professional firms had advised the holding company and not its individuals and that their invoices were dated after its incorporation and VAT registration.
Chris Hill, Partner, said: “This was something of a landmark case and we were pleased to be able to make a contribution to its successful outcome. The ruling could be important for newly created businesses and holding companies because it could mean that in certain situations they can reclaim VAT on deal fees.”
Chris Hill – Partner
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