- The Lycamobile UK Ltd First-Tier Tribunal (FTT) case focused on whether VAT was chargeable on the supply of a “Plan Bundle” at the time of sale or only when the allowances in the bundle were used
- Lycamobile argued that services were only supplied when allowances were used, while HMRC argued they were supplied at the time of sale
- The Tribunal decided that the Plan Bundle created a legal relationship between Lycamobile and the customer, with services provided at the time of sale
- The Tribunal also considered the vouchers point, but found that the Plan Bundles were not monetary entitlements for future services
- The appeal was dismissed and HMRC assessments totalling over £51 million were upheld
- The case highlights the importance of tax points, legal and economic realities, and customer perceptions in determining when VAT is due.
Source: deeksvat.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.
