Taxing times

www.pwc.co.uk

1 November 2016

Indirect Tax Forum

PwC

Agenda

November 2016Taxing times

Slide 2

17.00: Drinks reception

16.00: Guest speaker plenary and Q&A

16.50: Concluding remarks

15.20: Workshop session 2

14:00: Welcome and update on hot topics

Martin Blanche, PwC

14.20: Workshop session 1

13.30: Registration

15:00 Tea break

PwC

Today’s workshops

November 2016Taxing times

Slide 3

Workshops Room

1. VAT Case Law Update –Implications and issues on the horizon

Burton

2. Update on Larentia and Minerva – VAT and deal fees

Trafalgar 2

3. Introduction of GST in India –less than 6 months to go

Trafalgar 1

4. GlobalVATOnline – New developments, analytics and impact assessment technology

St James 1

PwC

Update

November 2016Taxing times

Slide 4

3

GMAC III Brexit

1

MG Rover and ors

2 4

Larentia + Minerva

5

Brexit

PwC

Potential timeline of an EU exit

Brexit scenarios

Key indirect taxes issues for your business

Questions???

EU Referendum – Now what?

November 2016Taxing times

Slide 5

1

2

3

4

PwC

Entitlement to s 80 repayment lies with single taxable person – MG Rover and ors [2016] UKUT 434 (TCC)

November 2016Taxing times

Slide 6PwC

Members of VAT groups – past and present

The Upper Tribunal held that the right to a s 80 repayment lies with the single taxable person and that any resolution of how the members of a group deal with that repayment is a private law matter. The decision raises as many questions as it answers and will be relevant to all taxpayers who have received Fleming refunds or whose business activities generated a Fleming refund.

PwC

HMRC v GMAC UK Plc [2016] EWCA Civ 1015Reductions in consideration and bad debt relief

November 2016Taxing times

Slide 7

1

2

3

The 'insolvency' and

'property' conditions

which the UK used to

impose for VAT bad debt

relief (BDR) were

incompatible with EU law

and therefore must be

disapplied.

Refunds the

taxpayer claimed

for VAT BDR

should be repaid

for all periods after

1989

.Taxpayer's pre-1989

BDR claims were

time-barred when the

'old scheme' for

making those claims

was withdrawn in

1997.

PwC

ECJ supports VAT deduction by ‘active’ holding companies and VAT grouping for natural persons

November 2016Taxing times

Slide 8

Active holding companies entitled to full VAT deduction on costs.

1

Cases reaching settlement and VAT refunds possible.

2

Finland and Denmark tax authorities announce a change in Policy. OtherEU territoriesmay follow

3 4

HMRC issueddraft guidanceand entered a consultation process… new RCB to be issued shortly!

Larentia + Minerva (C-108/14)

PwC

Do you know now which countries to focus on to prepare for Brexit?

Do you know what systems and procedures changes you may need to implement to support your business in a post-Brexit environment?

Brexit

November 2016Taxing times

Slide 9

Do you know the additional administration cost of customs certification at the new ‘border’?

Post Brexit do you know how much that cost will increase?

Have you mapped out your supply chain flows?

Do you know how much customs duty you pay now?

PwC

Today’s workshops

November 2016Taxing times

Slide 10

Workshops Room

1. VAT Case Law Update –Implications and issues on the horizon

Burton

2. Update on Larentia and Minerva – VAT and deal fees

Trafalgar 2

3. Introduction of GST in India –less than 6 months to go

Trafalgar 1

4. GlobalVATOnline – new developments, analytics and impact assessment technology

St James 1

PwC

Brexit – What next?

November 2016Taxing times

Slide 11

Indirect tax implications of a leave vote

PwC

Agenda

November 2016Taxing times

Slide 12

SummaryBrexit

scenariosHMRC

Perspective of the EU

27Questions

1 2 3

54

PwC

Examples of potential scenarios that could manifest in the upcoming UK/EU negotiations

Potential EU/UK agreements

European free trade agreement (EFTA)

Bilateral agreement(Swiss option)

• Belong to Single Market, must enact Single Market policy and legislation

• Free movement of goods (except agriculture and fisheries)

• Customs Border with EU

• No access to EU Free Trade Agreements (“FTAs”)

• Import VAT assessed

• Free movement of goods (except agricultural products)

• Customs Border with EU

• No access to EU FTAs

• EFTA has 27 FTAs covering 38 countries

• Import VAT assessed

• Free movement of goods (except agricultural products)

• Customs Border with EU

• No access to EU FTAs

• Flexible a la carte bilateral agreements

• Must enact pertinent EU legislation and policy

• Import VAT assessed

Ind

irec

t T

ax

Im

pli

cati

on

s

No access agreement (WTO/MFN)

• No free movement of goods

• Goods subject to default WTO/MFN rates crossing EU border

• Customs Border with EU

• No access to EU FTAs

• Import VAT assessed

EEA member (Norwegian option)

November 2016Taxing times

Slide 13

Global ITX ForumBrexit

1 November 2016

Ine Lejeune

Jurgen Gevers

PwC

The impact of Brexit on (global) trade

15

Brexit Monitor, Issue 11

PwC

The impact of Brexit on (global) trade

16

PwC

Future UK trade flows

17

PwC

Trade costs will increase

18

PwC

Reconsidering locations in supply chain and valuechain

19

PwC

Future UK trade flows

20

PwC

Questions?

November 2016Taxing times

Slide 21

PwC

Final points

November 2016Taxing times

Slide 22PwC

Feedback forms

1 Drinks reception!

3Next event

2

This publication has been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon the

information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the

accuracy or completeness of the information contained in this publication, and, to the extent permitted by law, PricewaterhouseCoopers LLP, its members,

employees and agents do not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to

act, in reliance on the information contained in this publication or for any decision based on it.

© 2016 PricewaterhouseCoopers LLP. All rights reserved. In this document, “PwC” refers to the UK member firm, and may sometimes refer to the PwC

network. Each member firm is a separate legal entity. Please see www.pwc.com/structure for further details.

161025-122027-CR-OS

Thank you