Publisher’s free lunch classed as ‘business’ by VAT tribunal

Food and drink provided by publisher Miller Freeman to conference delegates constituted business entertainment, a VAT tribunal has ruled.

The tribunal represents the latest chapter in the long-running saga of what is, or is not, business entertainment.

Les Allen, senior manager at Ernst & Young, who represented Miller Freeman, said the meals provided at a number of conferences and shows were effectively paid for in the ticket price, and was expected by people attending these events.

It was not business entertainment, said Allen, so Miller Freeman should be able to recover the input tax in the form of VAT charged by the caterers.

But Customs & Excise said there was no legal obligation for Miller Freeman to provide food, and it was therefore ‘business entertainment’.

The tribunal upheld Customs’ view.

Allen added: ‘The client is considering an appeal. Alternatively, I suppose conference contracts could be changed so that the entertainments are clearly shown as part of the ticket price.’

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