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The Court of Appeal dismissed an appeal from the High Court, and affirmed a decision that a series of license agreements entered into by a building development company, intended to reclassify the sale of dwelling houses as exempt from VAT, constituted neither a letting of immovable property nor a surrender of possession under the legislation. The court found that the agreements were artificial constructs with the principal aim of obtaining a tax advantage, which was contrary to the purpose of the EU 'VAT Directive'. Consequently, the arrangement was redefined under the abuse of rights doctrine, and the company's VAT assessment on the sale of houses to consumers was upheld.
Value Added Tax Act, license agreements, letting of immovable property, surrender of possession, self-supply, tax advantage, abuse of rights, Halifax doctrine, Court of Appeal, VAT Directive, artificial transactions, economic reality, Revenue Commissioners, Taxes Consolidation Act, EU law, proportionality principle, tax avoidance.
Note: This is intended to be a fair and accurate report of a decision made public by a court of law. Any errors should be notified to the editor and will be dealt with accordingly.
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