VAT Treatment of Mobile Plan Bundles by Lycamobile UK Ltd: FTT Decision and Implications

• Lycamobile UK Ltd sold plan bundles to customers in the UK for future telecommunication services
• Lycamobile believed VAT should only be charged when services were used, not when purchased
• First-tier Tribunal disagreed, stating VAT should be charged on entire consideration paid for plan bundles
• Case covered VAT periods from 07/12 to 08/19
• Prior to 1 November 2017, B2C telecommunication services were not subject to UK VAT if used outside the EU
• Lycamobile could make a VAT adjustment for non-EU roaming charges
• Plan bundles were not considered vouchers, so VAT rules for vouchers did not apply
• VAT was due on entire amount paid for plan bundles, even if part was unused, with potential adjustment for non-EU roaming charges pre-1 November 2017.

Source: taxscape.deloitte.com

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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