The First-tier Tribunal has allowed the taxpayer’s appeal in Sonder Europe Ltd v HMRC [2023] UKFTT 610 (TC), providing important guidance as to the scope of the Tour Operators Margin Scheme (“TOMS”).
Sonder leased apartments and let them to travellers as short-term accommodation. The question was whether TOMS applied to the supplies. If so, VAT was due only on the margin. The FTT allowed Sonder’s appeal, holding that:
Sonder was a “tour operator” for the purposes of TOMS.
The changes made by Sonder to the apartments (e.g. painting and furnishing empty apartments) did not mean TOMS was excluded.
Jonathan Bremner KC acted for Sonder.
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