Significant VAT Savings Opportunity for Serviced Apartment Providers: Recent Tribunal Decision Impacts Tax Liability

• Recent win at the First Tier Tribunal can lead to significant VAT savings for providers of serviced apartment accommodation
• VAT need only be accounted for on the margin made per the Tour Operators Margin Scheme
• Sonder Europe Limited successfully argued that they qualified as a “Travel Agent or Tour Operator” for the purpose of TOMS
• Short-stay serviced apartments now potentially fall under the scope of TOMS, resulting in significant VAT savings for operators
• Businesses that overpaid VAT on hotel-type accommodation may be able to submit a claim to recover the overpaid VAT
• HMRC have been given leave to appeal the FTT decision to the Upper Tier Tribunal in December 2024
• Taxpayers have a four-year statutory time limit for submitting claims before they go ‘out of time’

Source: claritastax.co.uk

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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