HMRC has published Brief 23/15, providing further information on its position following the ECJ judgment in Skandia [2015] EUECJ C-126/14. This is in addition to information provided in Brief 18/12 (details of which were reported in our November VAT update).

HMRC has received additional information about VAT grouping in the Netherlands and Spain and updated its position. The Netherlands is not expected to apply ‘establishment only’ VAT grouping. Spain is expected to adopt a two-tier approach, the basic method and the advanced method. The basic method treats each member as a separate taxable person and amalgamates their VAT figures on a single return. This will not trigger the UK VAT changes. The position in relation to the advanced method, however, remains unclear.

As noted previously, HMRC’s Briefs concerning this issue are only a guide. Businesses are strongly advised to check with the relevant Member State tax authority to confirm the position in that Member State.

Brief 23/15 is available to view here.