ACCOUNTANCY DAILY - Dec 9 - Gray & Farrar, an upmarket matchmaking business has failed in its bid at a First Tier Tribunal (FTT) to overturn a demand from HMRC for VAT due on the services it provides. Gray & Farrar argued that it should not be charged VAT on its services for the tax years 2012 through 2016. The company runs an exclusive dating service which provides clients with introductions to potential romantic partners, hand-picked for them by an adviser rather than by online dating apps. Clients sign up for a 12-month membership, which gives ~ eight introductions, starting from £15,000 a year. For VAT purposes, Gray & Farrar treated its service as a consultancy, which meant that clients resident outside the EU were not charged UK VAT on its fees. HMRC rejected Gray & Farrar's attempt to adopt a zero VAT status on the services provided and this saw the company appeal at tribunal. The case is a useful reminder for advisory businesses to think carefully about whether their service constitutes "consultancy” when determining the place of supply of their services to overseas clients."
by Pat Sweet
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