Sports Invest UK Limited v The Commissioners for HMRC
Decision date: 18 April 2023
Neutral citation: [2023] UKFTT 376 (TC)
Overall AI summary confidence: high
Short overview
This short overview is intended to summarise the case, issues and outcome so far as they are supported by the judgment.
AI confidence in this short overview: high
This appeal concerned whether a €4m payment from Inter to Sports Invest was consideration for services supplied to Inter (place of supply Italy) or third‑party consideration for services supplied to the player (which could give UK VAT implications). The tribunal found the Waiver Letter effective so Sports Invest had no legal right to payment from the player, held the payment was for services supplied to Inter (place of supply Italy), and allowed the appeal. The tribunal also concluded that, alternatively, paragraph 10 Schedule 4A VATA would have applied to place the supply outside the UK if needed.
Ratio decidendi
This summary is intended to identify the ratio decidendi, meaning the legal reasons for deciding and the binding part of the decision.
AI confidence in this ratio decidendi summary: high
The tribunal treated the contractual documentation and the surrounding commercial reality together to identify the recipient of the supply; where they align the contracts determine who received the supply. A supplier’s waiver can extinguish the recipient’s legal obligation to pay and thus prevent a payment being treated as third‑party consideration. Paragraph 10 Schedule 4A VATA can also attribute intermediary services to the place of the underlying supply where the intermediary acts in the name/on behalf of a party, and the threshold for that is low.
Obiter dicta
This summary is intended to identify obiter dicta, meaning observations made by the way that were not necessary to deciding the case and are not binding.
AI confidence in this obiter dicta summary: medium
The tribunal indicated (non‑bindingly) that “acting in the name and on behalf of another person” for paragraph 10 need not include formal power to bind the principal and can be satisfied by the parties’ recognition of the intermediary’s role. It also observed that employment contracts being outside VAT scope does not prevent paragraph 10 applying to intermediary activities that facilitate an underlying supply.