24 January 2022 Andrea Marshall, Tax Specialist
Update January 2022
The ECJ has ruled that parking fines charged when motorists have not followed the T&C's, when parking on a private parking area, are subject to VAT. The fees made up 34% of Apcoa's turnover.
The ECJ ruled that: "Article 2(1)(c) of the VAT Directive must be interpreted as meaning that the control fees levied by a company incorporated under private law, tasked with the operation of private car parks, in the event of failure by the motorists to comply with the general terms and conditions for use of those car parks must be regarded as consideration for a supply of services within the meaning of that provision and, as such, subject to VAT."
It will be interesting see if HMRC changes its policy.
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Grant Thornton has issued an update on “Apcoa parking”, Denmark Case C-90/20. The Advocate General has ruled in this case that that there is a sufficient link between normal charges for parking and parking fines, to make the fines standard rated. (Parking fines are currently treated as outside the scope of VAT). GT comments that if the Court of Justice agrees with the Advocate General will this give HMRC ammunition to change its policy?