VAT on Parking
Despite HMRC's unclear and inconsistent guidance on VAT in the parking sector, we have successfully secured favorable rulings from HMRC on various issues. Depending on how a parking operator has managed their income streams and commercial arrangements with landowners, there may be opportunities to reclaim overpaid VAT from HMRC.
We also help parking sector clients structure their contractual arrangements to maximize VAT efficiency. While commercial requirements always take priority, there are various ways to structure these arrangements to minimize the impact of VAT.
HMRC is currently attempting to restrict parking operators' ability to fully recover VAT on costs. This effort should not go unchallenged. We have experience negotiating with HMRC on this issue and will closely monitor the proceedings as this matter likely progresses through the courts. In the meantime, we can protect your position and minimize the impact of any actions HMRC may take.
Is there VAT on parking?
The Vehicle Control Services Court of Appeal judgment in 2013 allowed third-party operators to benefit from VAT-free PCNs. However, HMRC has since sought to narrow the scope of this judgment.
We have successfully used the VCS judgment and subsequent contract law cases to argue for a broader application of VAT-free PCNs than HMRC initially permitted. If operators have paid VAT on PCNs, they may be eligible for a refund. Our industry expertise enables us to submit and manage these claims on behalf of parking operators.
We are also equipped to handle HMRC challenges to VAT recovery, which HMRC sees as a trade-off where PCNs are VAT-free. Since input VAT recovery is likely to be litigated further, we can manage appeals on behalf of parking operators if necessary.
Contractual arrangements play a crucial role in many VAT issues and opportunities in the parking sector. With years of experience reviewing and advising parking companies on contractual arrangements, we can identify opportunities for VAT savings and manage potential VAT risks.