Tapi Carpets Limited v The Commissioners for HMRC
Decision date: 5 August 2026
Neutral citation: [2026] UKFTT 1128 (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
Tapi sold flooring and provided a paid "fitting arrangement" service matching customers with vetted independent fitters; HMRC assessed Tapi for VAT on fitters' fees on the basis Tapi was the supplier. The First-tier Tribunal found the written terms and surrounding conduct showed fitters contracted with and supplied the fitting services to customers and that Tapi acted as a disclosed agent for an arrangement fee. The tribunal allowed Tapi's appeal and rejected HMRC's assessments charging Tapi VAT on the fitters' fees; Tapi remains liable for VAT on its arrangement/delivery & care fees.
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
Where the contractual documentation and consistent commercial conduct establish that an intermediary arranges and introduces a customer to a supplier chosen from an independent pool and the supplier contracts with and is paid by the customer, the supplier (not the intermediary) is the VATable provider of the service; direct customer payment to the independent contractor is a strong indicator of that position when supported by the contractual and factual matrix.
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 observed that customer-facing use of "we"/"our" in marketing does not necessarily negate an agency relationship if the written terms and conduct allocate contractual responsibility clearly; and that findings from employment/PAYE enquiries about contractors' status do not directly determine VAT characterisation.