This long-running case was commenced in 2008 by the NAPF and the Wheels Common Investment Fund (which holds £8bn in assets for the Ford, Jaguar and Land Rover schemes) against HMRC for recovery of VAT paid by occupational pension schemes on third-party investment management fees. The First-tier Tribunal (Tax Chamber) has published an order referring a number of questions to the ECJ. The referral was made in February but the order has only recently been made publicly available.

In 2007 the ECJ decided, in the JP Morgan Fleming case, that the management expenses of investment trusts should be exempt from VAT. The Wheels case essentially asks whether this exemption should extend to pension schemes. It turns on whether a defined benefit occupational pension scheme (or a common investment fund in which the assets of several such schemes are pooled) constitutes a “special investment fund” which is exempt from VAT. We understand the case is likely to be heard in mid-2012.

The full order can be found here