TaxCorporate TaxHairdressers win VAT battle over membership rules

Hairdressers win VAT battle over membership rules

The National Hairdressers Federation wins £20,000 plus interest and costs after the taxman drops its case against over membership fees

THE NATIONAL HAIRDRESSERS FEDERATION has won back £20,000 plus interest and costs from HM Revenue & Customs after the tax-man changed the rules over membership subscriptions.

Previously, the tax-man allowed non-profit-making membership organisations charging a membership fee to use extra-statutory concession 3.35 to apportion between standard-rated, zero-rated and exempt VAT elements.

The hairdressers won an initial tribunal against the tax-man, and were awaiting payment, when the tax-man changed the rules.

With another tribunal looming, the tax-man again backed down. Advisors from CCH helped the NHF receive its settlement as well as interest and costs.

Glyn Edwards, VAT consultant at CCH, said: “When we submitted the pre-tribunal statement case, HMRC’s advocate agreed with me that they should not have applied the new rules to a prior appeal and the case was dropped.

“Even better for the NHF was the fact that they not only received the £20,000 plus interest they were owed; they were also awarded costs, which almost never happens with HMRC.”

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