EY VAT News week to 20 November 2017

Transcription

1 Click here to view online EY VAT News week to 20 November 2017 Welcome to the latest edition of EY VAT News, which provides a roundup of indirect tax developments. If you would like to discuss any of the articles in more detail, please speak with your usual EY indirect tax contact or one of the people below. If you have any feedback or comments on EY VAT News, please contact Ian Pountney. Previous editions of EY VAT News can be found here. In this edition: Brexit Public Accounts Committee report Customs Declaration Service Commons Home Affairs Committee report Lack of Government contingency planning risks Brexit border chaos Brexit Implementation Bill European Union (Withdrawal) Bill report Taxation (Cross-border Trade) Bill introduced in Parliament Legislation Finance (No.2) Act 2017 receives Royal Assent Court of Justice of the European Union Judgment: For the purpose of VAT recovery, a valid VAT invoice does not have to record the address from which an economic activity is performed Judgment: Own use of a property qualifies as a first supply ; Member States can impose a cost base for determining whether a property has been converted Calendar Update HMRC Material Research and analysis - Behaviours and experiences in relation to VAT registration Update on the VAT liability of pension fund management services supplied by regulated insurers to defined benefit schemes EY Global Tax Alerts Ghana 2018 Budget Statement and Economic Policy

2 Brexit Public Accounts Committee report Customs Declaration Service Under current plans, the UK is set to leave the European single market and the customs union in March In this latest report, Brexit and the future of Customs, the Public Accounts Committee (PAC) warns that Government must do more to work with businesses and ensure that contingency plans are in place before January The PAC reports that it would be catastrophic if HMRC's new customs system, the Customs Declaration Service (CDS), is not ready in time and if there is no viable fallback option. In 2015, around 55 million customs declarations were made by 141,000 traders. The UK's exit from the EU could see the number of customs declarations, which HMRC must process each year, increase five-fold to 255 million. A failed customs system could therefore lead to huge disruption for businesses The report highlights that this is a programme of national importance that could have a huge reputational impact for the UK if it is not delivered successfully. The uncertainty regarding the outcome of UK-EU negotiations is a complicating factor but it should not be used by HMRC to avoid taking action now in areas including: scaling up the CDS service to handle 255 million declarations; ensuring a viable contingency option is in place well before January 2019; and communicating with businesses. The report's conclusions and recommendations include: HMRC has not yet done enough to manage the huge uncertainty faced by a large number of businesses. It should ensure that businesses are informed of the CDS timeline and progress by January As part of its plans to broaden engagement, it should also promote the benefits of obtaining trusted trader status and aim to increase the number of those registered It is vital that HMRC has a flexible service which can handle the increased volume of customs declarations and a welldeveloped contingency option. It should ensure that the CDS system and the CHIEF contingency option are capable of managing 255 million customs declarations every year, while providing the flexibility to meet the wider challenges of an integrated customs and trade system for the UK, such as managing changes to tariffs, Free Trade Agreements and international trade quotas. HMRC should report back to the Committee by March 2018 re progress HMRC does not yet have funding to increase the capacity of CDS or to develop contingency options. HMT should ensure that HMRC has sufficient funding by December 2017 HMRC is currently managing an unsustainable amount of change which could put the delivery of CDS at risk. It should report back to the Committee by March 2018 with clear plans on how it will manage the many challenges it faces due to Brexit and its ongoing transformation programmes, including how this will help to mitigate the risks in the CDS programme The PAC report forms part of the Committee's ongoing examination of aspects of the UK's departure from the EU. For further information please contact Andy Bradford. Commons Home Affairs Committee report Lack of Government contingency planning risks Brexit border chaos The Commons Home Affairs Committee in its report, Home Office delivery of Brexit: customs operations, has raised serious concerns regarding the Government's contingency planning for post Brexit customs operations and warns major border disruption could ensue unless urgent action is taken. The report notes that maintaining the operational status quo for customs arrangements and remaining in the customs union would cause the least upheaval at the border and deliver certainty for business. The Government should aim to swiftly agree transitional arrangements with the EU which involve no practical change to customs operations either in the UK or the EU, and especially at the Irish border. The report raises a number of concerns: The risks if no deal is secured, which would result in customs in the UK experiencing a huge amount of change in a very short time, with a vast increase required in capacity and processes at the border Rapid changes and a failure to plan could see the UK facing delays and traffic jams at ports

3 Any change to customs arrangements, after March 2019, will require similar investment and planning at the EU side of the border - especially in France, Belgium and Ireland A 4% increase in Border Force staff is too small as they carry out customs checks in many ports. There is a risk of Border Force being diverted from security and immigration checks into customs checks The Committee welcomes proposals to use the approved operators scheme but calls for action to accredit more businesses now Insufficient contingency planning has been done for Britain leaving the EU with no deal. The report calls on the Government to publish detailed plans on the impact on Britain's customs arrangements of all potential outcomes of the Brexit negotiations, including a no deal There is a lack of coordination across government, who were unable to specify which single Minister is responsible for border planning There are serious concerns about the Government's readiness to respond to changes in customs arrangements at Britain's borders. HMRC has estimated that Brexit could lead to an increase of up to 360% in the annual number of customs declarations in the UK. The Institute for Government estimates that the introduction of customs declarations on EU trade could cost traders between 4 billion and 9 billion a year HMRC's new IT system, the Customs Declaration Service, will play a vital role in post-brexit customs arrangements but this project is not due to be completed until January 2019, only two months before Brexit day. The Committee calls on the Government to set out what contingency planning is in place should the system be delayed or lack full functionality The border between Northern Ireland and Ireland is acknowledged to present particular difficulties for post-brexit. Plans to expand the use of the trusted trader Approved Economic Operator and approved warehouse schemes could address some of the specific issues here and in the UK more widely. But the Government needs to do more to inform traders now about what this would mean in practice. The Committee is clear that the Home Office cannot wait until an agreement has been reached with the EU before taking action. It will take time to hire and train additional staff, to build physical infrastructure at ports, and to develop IT systems. Any changes to customs arrangements will impact on EU ports too with delays. Businesses need to be given time to plan ahead and adapt to new arrangements. For further information please contact Andy Bradford Brexit Implementation Bill The Government has announced that a new Implementation Bill will be drawn up to enshrine the EU Withdrawal Agreement in domestic law, and Parliament will be able to debate and vote on this Bill. This Bill is separate to the EU (Withdrawal) Bill which is currently being debated in Parliament. The press release is available here. For further information please contact Andy Bradford European Union (Withdrawal) Bill report The Government released a report on the European Union (Withdrawal) Bill on 17 November. The report followed a short inquiry to examine aspects of the Bill in order to inform the Committee and Report Stage. The inquiry focused on the Bill's provisions for converting EU law into British law, the implications for the devolution settlements and the power to implement the withdrawal agreement. The report concluded that: The Government's amendments to set the exit day as 11pm on 29 March 2019 would create significant difficulties if EU negotiations go down to the wire More clarity is needed on the scope and status of retained EU law Article 191 of the Treaty on the Functioning of the EU which covers the precautionary principle should be converted into domestic law as a directly effective right The Government should justify the purpose of Clause 9 of the EU (Withdrawal) Bill given its announcement of a separate EU Withdrawal Agreement and Implementation Bill

4 After leaving the EU, some retained EU laws could be amended to better reflect the UK's regulatory and business environment. In other areas, the report suggested that it will be in the UK's interest to keep pace with changes to laws in the EU as seems to be suggested, for example, by the delegated powers in the Trade Bill and the Nuclear Safeguards Bill. The report recommended the Government should publish details of how they will ensure the UK's regulatory agencies have the necessary resources and enforcement powers which are vital for consumer confidence and access to markets. The Committee heard evidence for and against the Bill's removal of the Charter of Fundamental Rights from domestic law. The purpose of the Bill is to provide legal certainty for the UK the day after it leaves the EU and not to reshape rights in the UK. The Committee encouraged the Government to improve engagement with the devolved administrations in order to reach agreement with the devolved administrations on how and when reserved competencies will be devolved. An estimated 800 to 1,000 statutory instruments will need to be passed before exit day. The Committee cautioned that uncertainty will only be removed if all the necessary legislative amendments are in place by any potential exit day to ensure no gaps are left in the statute book. A summary of the report's conclusions, are available here. For further information please contact Andy Bradford Taxation (Cross-border Trade) Bill introduced in Parliament On 20 November 2017, the new The Taxation (Cross-border Trade) Bill, previously known as the Customs Bill, was introduced to the House of Commons and given its First Reading following debate and approval of the relevant Ways and Means Resolutions. MPs will next consider the Bill at Second Reading. The date for second reading has not yet been announced. The Bill, first announced in the Queen s Speech, follows the publication of the White Paper Legislating for the UK s future customs, VAT and excise regimes in October, which set out the key objectives of the legislation. As the rules governing customs are mostly in EU law that is directly applicable in the UK, and existing UK legislation is insufficient to establish a standalone customs regime, leaving the EU will mean that the UK will require new domestic legislation. The Bill does not presuppose any particular outcome from the UK s negotiations with the EU. In addition to legislating for a contingency scenario where the UK leaves the EU without a negotiated outcome, the Bill also provides for a range of negotiated outcomes, including an implementation period. In assessing the options for the UK s future customs relationship with the EU (and therefore, how the government uses the powers in the Bill), the government has said that it will be guided by what delivers the greatest economic advantage to the UK, and by three strategic objectives: ensuring UK-EU trade is as frictionless as possible avoiding a hard border between Ireland and Northern Ireland establishing an independent international trade policy Responding to business representations, Parts 1 and 2 of the Bill, which provide for a new standalone Customs regime, are largely based on EU law, and it is the government s intention that the UK s Customs regime will continue to operate in much the same way as it does today following exit from the EU. However, depending on the outcome of the negotiations, traders that currently trade only with the EU may be subject to Customs declarations and Customs checks for the first time. The Bill would allow for divergence from EU law where the government feels it is necessary to do so, or where it believes that there is a clear benefit to business to diverge from it and such divergence is consistent with whatever bilateral arrangements the government agrees with the EU. Whilst the precise nature of the UK s future customs relationship with the EU will be the subject of negotiations, the Bill will allow the government to: charge Customs duty on goods (including on goods imported from the EU)

5 define how goods will be classified to establish the amount of Customs duty due establish a new UK tariff and set out additional tariff-related provisions set and vary rates of Customs duty, specify where goods are subject to quotas and where goods are relieved from duty vary or suspend duty at import in certain circumstances, e.g. supporting developing countries by offering preferential treatment implement arrangements to establish a customs union between the UK and another territory or country request and collect tax-related information from declarants and store and share it as appropriate provide for amendment of existing VAT and excise legislation. It will provide for the EU concept of acquisition VAT (for business-to-business intra-eu movements) to be abolished so that import VAT is charged on all imports from outside the UK allow the VAT and excise regimes to continue to function whatever the outcome of the negotiations Other trade provisions were included in the Trade Bill, which was introduced to Parliament on 7 November Information and supporting documents for the Taxation (Cross-border Trade) Bill is available here Comment: The progression of these two pieces of domestic Brexit legislation will be seen as a positive step by many, despite the final post Brexit trade and Customs models remaining unknown and subject to further EU negotiation and agreement. That said, it is clear that, no matter how light, there will be a UK/EU border which businesses should start preparing for now as changes required may have long lead times. For further information please contact Andy Bradford Legislation Finance (No.2) Act 2017 receives Royal Assent The Finance Bill received Royal Assent on 16 November 2017, becoming Finance (No.2) Act The Finance Bill was substantively enacted on 31 October, and all remaining stages in the House of Lords took place on 15 November. Court of Justice of the European Union Judgment: For the purpose of VAT recovery, a valid VAT invoice does not have to record the address from which an economic activity is performed C-374/16 Geissel & C-375/16 Butin On 15 November 2017, the Court of Justice of the European Union (CJEU) released its decision in the joined cases of RGEX Gmbh (in liquidation and represented by Rochus Geissel) and Igor Butin (AG). These German referrals ask: Whether a tax invoice is valid, in this case for the purpose of VAT recovery, where it records the supplier's postal address rather than the address from which the economic activity is performed Whether the VAT Directive precludes a national practice of accepting claims of good faith RGEX Gmbh, represented by Geissel, (RGEX), traded in motor vehicles and sought to recover VAT against 122 transactions relating to vehicles purchased from EXTEL Gmbh. The tax authorities refused recovery on the grounds that EXTEL had no establishment at the address provided on the invoices. The Finance Court subsequently dismissed RGEX's appeal holding that the address provided by EXTEL was merely a postal address and none of EXTEL's commercial activities were carried out there. Igor Butin (Butin) also traded in motor vehicles and relied on invoices issued by an internet dealer to recover VAT on a number of purchased vehicles. The vehicles were delivered to Butin, either at the dealer's corporate address or agreed public

6 places. The tax authorities refused VAT recovery as the supplier's address shown on the invoices was incorrect, nothing at that address indicated the presence of a business. The Finance Court subsequently allowed Butin's appeal, holding that the indication of an address on an invoice, does not mean that business activities have to take place there. The Court found that, in light of advances in technology and changes in business practices, the existing national case-law is outdated. Moreover, in its view, Butin had done everything that could reasonably be required in order to verify the supplier's status as a business and the accuracy of the content of the invoices. RGEX and the tax authority appealed the respective decisions to the Federal Tax Court which referred the cases to the CJEU for a preliminary ruling. In agreement with the Advocate General, the CJEU held that the right to deduct VAT may not, in principle, be limited. The substantive conditions for the deduction of VAT require that the claimant must be a taxable person, that the goods or services acquired are used by the taxable person for the purpose of taxable supplies and that the goods or services are supplied by a taxable person. The requirement that a taxable person holds a valid invoice which shows, inter alia, the full name and address of the supplier and the customer, is a formal condition and the Court has consistently held that in the absence of being knowingly involved in fraud, the deduction of VAT is to be allowed if the substantive conditions are satisfied, even if there has been a failure to comply with certain formal conditions. It follows that the detailed rules, regarding the indication of the address of the issuer of the invoice, cannot be a decisive condition for the purposes of the deduction of VAT and consequently, the VAT Directive precludes national legislation from requiring an invoice, for the purpose of the deduction of VAT, to show the address where the supplier carries out its economic activity. In view of its judgment on the first point raised by this joined case, the CJEU declined from considering the remaining questions referred regarding - the principle of effectiveness, claims of good faith and the principle of the protection of legitimate expectations. Comments: This judgment follows a number of recent CJEU cases and provides further support that meeting the substantive conditions for VAT deduction should be enough to defend a challenge by the tax authorities. Any businesses which have been denied VAT recovery in similar circumstances may wish to revisit the decision. Judgment: Own use of a property qualifies as a first supply ; Member States can impose a cost base for determining whether a property has been converted C-308/16 Kozuba Premium Selection On 16 November 2017, the Court of Justice of the European Union (CJEU) released its decision in this Polish referral, asking whether Article 135(1)(j) of the VAT Directive precludes a national provision under which the supply of buildings and civil engineering works is exempt save where: (a) The supply is made within the period of first occupation or prior to the first occupation; (b) The period between the first occupation and the supply was shorter than 2 years following their erection or upgrade if the expenditure incurred on the upgrade constituted at least 30% of the initial value. Kozuba Premium Selection sp. Z.o.o (Kozuba) acquired a residential building and in 2006 it was renovated and adapted, at a cost of 55% of its initial value, so as to allow Kozuba to use the property as a show home. Kozuba subsequently sold the property as an exempt disposal on the basis that the building was not new and was already in use, i.e. being used by Kozuba as a show home. The tax authorities considered the disposal of the building to be subject to VAT and assessed Kozuba. The tax authorities asserted that exemption is only permitted for a transfer of a building after its first occupation and this can only be achieved after a taxable transaction. As the building had been used by Kozuba, this did not amount to first occupation. The construction or substantial renovation of a building must be taxed at the point of the taxable transaction and the added value must be imposed at the time of that supply. Where a taxable transaction has not taken place, regardless of how long it has been used for own purposes, whether new or refurbished, it is always a new building.

7 On appeal, the Supreme Administrative Court questioned whether the national definition of first occupation unjustifiably limits the effectiveness of the VAT exemption under Article 135(1)(j) and whether the concept of the renovation of buildings (which prevents exemption on subsequent supplies) complies with Article 12. In agreement with the Advocate General, the CJEU held that the exemption provided in Article 135(1)(j) refers to Article 12(1)(a). It follows that, in accordance with that reference, supplies of buildings are exempt, with the exception of those referred to in Article 12(1)(a). The underlying principle of the exemption requires that the transferred buildings are not new, the logic being to impose the economic activity with the incorporation of added value, for real estate this is inherent in the construction of a new building. The first supply of which creates the obligation to pay VAT. The CJEU noted that whilst the concept of first occupation appears in Article 12, it does so without definition. In this regard the CJEU considered that the criterion of the first occupation of a building must be understood as corresponding to the first use of the property by its owner or tenant and it does not follow that the use must take place in the context of a taxable transaction. However, with regard to renovated property, the AG considered that the imposition in domestic law, that a building will be considered converted if the expenditure incurred for its improvement amounts to at least 30% of the initial property value does not, in principle, go beyond the permitted limitation of the scope of the exemption. In this regard the CJEU considered it necessary to define the concept of conversion in Article 12(2). It was suggest to include, at the very least, that the building must have been subject to substantial modifications intended to modify its intended use or alter considerably the conditions of its occupation. In the present case, the concept of conversion has been transposed into Polish law with reference to upgrade. The costs incurred by the upgrade of the building in question amounted to 55% of its initial value. Even though such a percentage suggests that the modifications made could have, as a result of their quantity, contributed to altering considerably the conditions of occupation of the building, it is for the national court, to assess on the basis of the evidence available to it, the extent to which the upgrade led to a substantial modification of that building. Comments: This case relates to the application of the exemption into Polish law, in the UK there is already a completion test/first occupation test for the purposes of Article 12(1). Any business which has had exemption denied, where there has been a period of own use prior to disposal with no substantial renovation works, may wish to consider the implications of this judgment. For further information please contact Ali Anderson. Calendar update Wednesday 22 November 2017 Judgment - C-251/16 Cussens and Others Irish referral asking whether certain transactions constitute an abusive practice liable to redefinition under the Halifax doctrine (which addresses the scope of the EU principle of abuse of rights in the context of VAT), even in the absence of national legislation giving effect to that principle and in circumstances where the transactions were completed before the CJEU judgment in Halifax. Thursday 23 November 2017 Opinion - C-566/16 Vamos An Hungarian referral asking whether national legislation, which requires an application for exemption from VAT under the small enterprise exemption to be made on commencement of taxable activities, is contrary to EU law. Judgment - C-246/16 Di Maura - An Italian referral regarding limits applied to the application of Bad Debt Relief. Thursday 30 November 2017 Opinion - C-580/16 Firma Hans Bühler An Austrian referral asking whether Article 141(c) of the VAT Directive is to be interpreted as meaning that the requirement laid down in that provision is not met where the taxable person is resident and identified for VAT purposes in the Member State from which the goods are dispatched or transported, even if that taxable person uses the VAT identification number of another Member State for that specific intra-community acquisition?

8 Opinion - C-8/17 Biosafe - Indústria de Reciclagens - A Portuguese referral asking whether the VAT Directive and the principle of neutrality preclude national legislation which, in circumstances where a VAT inspection finds that the wrong VAT rate has been applied to a supply, the error is corrected and the supplier seeks to obtain the respective additional VAT from the purchaser, sets the time period for the purchaser to deduct the additional VAT from the date of the initial invoice and not from the date of issue or receipt of the correction documents? If answered in the negative, does the VAT Directive and the principle of neutrality preclude legislation which allows the purchaser to refuse to pay the additional VAT, on the basis that refusal of the passing on of VAT is justified where it is impossible to deduct that additional tax? Tuesday 12 December 2017 Opinion - C-532/16 AB SEB Bankas - A Lithuanian referral asking various questions as to whether an adjustment to VAT is applicable, per Articles 184 to 186 of Council Directive 2006/112/EC, in cases where an initial deduction could not have been made because the transactions in question related to an exempt supply of land. Wednesday 13 December 2017 Hearing - C-665/16 Gmina Wroclaw - A Polish referral asking whether the transfer of ownership of immovable property owned by a municipality of the state in return for payment of compensation, where the property continues to be managed by the municipality, constitutes a taxable supply. Hearing - C-544/16 Marcandi Limited T/A Madbid A UK referral from the First-tier Tribunal asking whether the issue of credits to 'users' of an online auction, by Madbid, in return for a monetary payment is a 'preliminary transaction' outside the scope of VAT or a supply of services, namely the grant of a right to participate in an online auction. If a supply of services, is it a supply made for consideration when it issues the credits, if not, is such a supply made at any other time? The referral also asks what, in these circumstances and considering the answers to the initial questions referred, is the consideration received by Madbid for the supply of the goods; Is the credit a payment on account and therefore consideration for a supply of goods, what is the total value of the supply of the goods and what is the effect of unsuccessful bids and credits used? Comment: This is the same business as the Welmory CJEU referral, and the questions being referred this time are questions that were discussed by the AG in Welmory, but never addressed as the judgement went in a different direction. As well as similar businesses, this will be of interest to businesses offering vouchers and promotion schemes, where there may be a read across in terms of the scope and implications for credits. For further information please contact Rosie Higgins Thursday 14 December 2017 Judgment - C-305/16 Avon Cosmetics UK referral from the First-tier Tribunal in relation to the Avon Cosmetics case (TC03311), on the UK's direct selling or 'party plan' derogation. Specifically, the case concerns a failure of the UK derogation, which deals with retail sales made through non-registered representatives, to provide for any VAT deduction in respect costs borne by sales representatives, whilst requiring the taxpayer (on selling to those representatives) liable to VAT by reference to the retail open market selling price received by the representatives. The First-tier Tribunal referred the case to the CJEU on the question of whether the derogation was lawful in this respect, and expressed its own opinion that it was not. In April 2016, HMRC issued Revenue & Customs Brief 19/14 which sets out its position following the First-tier Tribunal's decision. In short, the Brief confirms that HMRC remains of the view that the derogation has been applied correctly and that VAT incurred by unregistered representatives of Avon (or other retailers) on their purchase of demonstration items cannot be offset against the VAT due on sales to final consumers. For further information, please contact Mitchell Moss, Andy Richardson, Dermot Rafferty or Ethan Ding

9 HMRC Material Research and analysis - Behaviours and experiences in relation to VAT registration This research, a combined quantitative and qualitative study examining why small businesses register for VAT and their perceptions and experiences of doing so, was conducted with businesses that registered for VAT in the last 2 financial years and those that had a turnover below, but close to, the threshold in the last 2 financial years. The key research objectives were to explore: The main factors that affect a business' decision to voluntarily register for VAT when their turnover is below the VAT threshold The main issues faced by newly VAT registered businesses, whether the current VAT simplification schemes address these issues and how they could be improved The types of businesses that restrict business activities to remain below the VAT threshold, their main reasons for doing so and how they ensure they remain below the threshold Key findings include: VAT registered businesses were more likely than unregistered borderline businesses to make most (i.e. more than 60%) of their sales to other VAT registered businesses Accountants were the most common source of advice on VAT (67% of registered businesses got information from an accountant when deciding to register and 57% of unregistered borderline businesses have sought information on VAT from an accountant). The second most common source was HMRC VAT registered businesses were asked about awareness of different aspects of VAT. Awareness was very high across most aspects, including the need to submit accurate returns on time, the ability to claim back VAT and the requirement of additional record keeping. Awareness among unregistered borderline businesses was mixed The most common, unprompted, reason given for registering for VAT by voluntary registered businesses is the expectation of reaching the threshold soon (26%), followed by agent advice (20%) and the ability to reclaim VAT (13%). Having registered, the main benefit was seen as reclaiming VAT (mentioned by 33% of voluntary registered and 27% of mandatory registered without prompting). This was followed by improved reputation or credibility (20% and 12% respectively) Additional administrative burden was the most commonly anticipated drawback of registering (cited by 35% of voluntary registered and 31% of mandatory registered businesses). Reflecting initial expectations, extra paperwork and administration was the most frequently mentioned drawback after registering. when prompted, the majority of businesses disagreed administration is too much of a burden Virtually all businesses paid their VAT quarterly (98%) and most accepted the stagger period they were allocated when they first registered Of the three VAT support schemes asked about, usage was highest for the Flat Rate scheme (46%), followed by the Cash Accounting scheme (15%) and Annual Accounting scheme (5%). Experience of the schemes was mainly positive A majority agree that businesses which use illegal means to avoid paying VAT are likely to be caught ; with unregistered borderline businesses more likely to have this view (79% compared to 67% of registered businesses) Overall, 20% of unregistered borderline businesses admit to having taken some action to remain under the threshold and outside the VAT system Update on the VAT liability of pension fund management services supplied by regulated insurers to defined benefit schemes In October 2017, HMRC announced in Revenue and Customs Brief 3 (2017): VAT - treatment of pension fund management services, that pension fund management services supplied by an insurer in respect of defined benefit schemes would be subject to VAT with effect from 1 January Since issuing the Brief, HMRC has been in discussion with industry representatives and has now updated the Brief to confirm a delayed implementation date of 1 April Please see our earlier Alert for further details. For further information please contact Janet Waweru or Mitchell Moss

10 EY Global Tax Alerts Ghana - The Minister of Finance and Economic Planning presented the 2018 Budget Statement and Economic Policy to Parliament on 15 November The theme of the Budget is From stabilisation to growth, putting Ghana back to work. According to the Minister, the Government is seeking to ignite the entrepreneurial spirit in Ghanaians and provide opportunities for Ghanaians to initiate projects of their own. The Government reiterated its resolve to continue with its fiscal consolidation programs during the 2018 fiscal year. The Budget outlines the broad vision of the Government which includes the creation of a robust economy that supports a thriving private sector. In light of this, the Minister presented various strategies, policies and actions to be undertaken to achieve the vision of the Government. From an Indirect Tax point of view the statement included plans to examine the design of the VAT system with a view to address any significant policy shortcomings that may be identified. EY Assurance Tax Transactions Advisory About EY EY is a global leader in assurance, tax, transactions and advisory services. The insights and quality services we deliver hel p build trust and confidence in the capital markets and in economies the world over. We develop outstanding leaders who team to deliver on our promises to all of our stakeholders. In doing so, we play a critical role in building a better working world for our people, for our clients and for our communities. EY refers to the global organization, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. For more information about our organization, please visit ey.com. Ernst & Young LLP Ernst & Young LLP Published in the UK. All Rights Reserved. The UK firm Ernst & Young LLP is a limited liability partnership registered in England and Wales with registered number OC and is a member of Ernst & Young Global Limited. Ernst & Young LLP, 1 More London Place, London, SE1 2AF. Information in this publication is intended to provide only a general outline of the subjects covered. It should neither be regarded as comprehensive n or sufficient for making decisions, nor should it be used in place of professional advice. Ernst & Young LLP accepts no responsibility for any loss arising from any action taken or not taken by anyone using this material. ey.com/uk Important commercial notice: This may constitute an advertisement or solicitation under US law, if its primary purpose is to advertise or promote Ernst & Young LLP s products or services. Our principal postal address is 1 More London Place, London SE1 2AF. Please click here to remove this from the subscription for this communication. Use the link below to opt-out if you would prefer not to receive any advertising or promotional from Ernst & Young LLP (except for EY Online and the ey.com website, which track preference through a separate process). Your address will be immediately removed from our central mailing list for newsletters and alerts, and all s from Ernst & Young LLP designated as advertising or promotional will be automatically blocked as soon as necessary. Click here to remove yourself from all Ernst & Young LLP commercial s.