A stop to looping

Satvi Vepa considers the rules introduced to counter VAT offshore looping

Following the case of Hastings Insurance Services Limited v HMRC [2018] UKFTT 27 (TC) (see below), the Government announced in July last year that secondary legislation would be introduced to tackle VAT avoidance relating to a particular off-shore looping arrangement used almost exclusively in the insurance sector. The VAT (Input Tax) (Specified Supplies) (Amendment) Order 2018 (the ‘Amendment Order’) was drafted for this purpose. It was laid before Parliament on 11 December 2018 and came into effect for supplies made on or after 1 March 2019.