HM Revenue & Customs has committed to revising the Revenue and Customs Brief (RCB) 12 (2020): VAT early termination fees and compensation payments.
They are reviewing whether taxpayers had a legitimate expectation to treat early termination and other similar payments as outside the scope of VAT prior to the publication of the RCB.
The HMRC has also committed to expanding the guidance to assist people in understanding what is and is not within the scope of VAT. It has also committed to responding to the BVRLA’s representation and will provide industry with an opportunity to comment on the revised guidance before publication.
Until they provide updated guidance, HMRC’s operational team have been advised to take no proactive action based on RCB 12 (2020).
See the HMRC’s RCB 12 (2020) policy paper on the GOV.UK website
