When an intermediary or agent provides services, the question of who qualifies as the recipient for VAT purposes arises. Both parties benefit from the service, so they can both be considered the recipient. The payment of the agent’s commission is often used to determine the recipient, but it can be complicated by third-party consideration. The FTT in Sports Invest determined that if one party is contractually obligated to pay the commission and actually pays it, it is only consideration for a service to them. HMRC argued that any service supplied to the player was subject to the B2C general rule, but this was a strange argument as an employment contract constitutes a supply of services and the absence of the second limb in the underlying transaction does not render Article 46 inapplicable.
Source Fabian Barth
