The heat is on

first_imgWhat is the difference between a toasted sandwich sold by Subway and one sold by Quiznos? Answer: 17.5% VAT, soon to go up to 20%. Why? because HMRC treats one as hot food and not the other.It is all to do with the legal definition of hot food for the purposes of VAT. The law makes suppliers of hot food subject to VAT. But to be classed as hot food, the food must have been heated for the dominant purposes of hot consumption. In other words, if the food was heated for some other purpose, it may be zero-rated for VAT. The trouble lies in establishing the purpose.In the case of Quiznos, a tax tribunal found that the dominant application of heat was to toast the sandwich, but for Subway, the tribunal found that the same process had a dominant purpose of making the food hot for consumption and the toasting was not the dominant element.In the past, the VAT tribunal has found that the dominant purpose in applying heat to hot meat pies (Pimblett) and Cornish pasties is to finish the baking process, the same is true of hot ciabatta melts (Ainsleys) and panini (Warren), to name but a few zero-rated items. On the other hand, freshly baked pizza is taxed.So how do you go about deciding which rate of tax is correct for your product? By checking the temperature. Did you know that the law regards something as hot if it is above ambient air temperature? This means that, on a cold day, lots of things could be regarded as hot even if your customer would regard them as cold. Subway’s toasted sandwiches were found by the tribunal to be lukewarm, but this made them above ambient air temperature.The other feature is that, if any part of a product is above ambient air temperature, the whole of the product is treated as hot. So lukewarm toast containing cold salad may be classed as hot.Once you have a temperature reading that is anything over ambient air temperature, you must then ask yourself your purpose in heating it. Is your purpose to complete a baking or similar process, or is it so that an item can be intentionally eaten hot by your customer? This bit sounds simple, but in practice, it is a difficult question. Recently, the tribunal has set about analysing intention in evermore complex ways for instance wishing to see franchise agreements of food outlets, operational manuals and advertising materials. The tribunal may attach great significance to a picture of a product showing steam rising from it, for example.The HMRC viewHMRC does offer guidance in its public notices, which are available online and you may wish to speak to them about this. But remember, HMRC is a tax collector and the number of tribunal cases it has lost shows that it is in the habit of ruling that hot food should be subject to VAT where it should not have done. So bakers need to think very carefully about a product before taking the matter to HMRC.Also, be prepared for HMRC to come to you and find products currently free of VAT to be reconsidered. In such cases, it is normal for HMRC to issue a back-dated assessment and charge interest, even where the tax was not collected. Sometimes, reconsidering the dominant purpose for heating may lead to a back-claim to HMRC for overpaid VAT, where VAT has been charged by mistake.But where agreement cannot be reached, appeals against HMRC decisions are taken to the first-tier tribunal tax chamber, a specialist court designated to deal with tax issues. HMRC has solicitors to deal with these issues, who normally instruct a specialist tax barrister to represent them. Although this sounds daunting, with careful preparation, a tribunal appeal can run smoothly. Even if the taxpayer loses the appeal, HMRC will not seek to recover its legal costs unless the appeal was frivolous or vexatious or there had been an agreement on costs at the onset. Each case must be looked at on its own merits.l Dipak Jotangia is an expert in tax, fraud and regulatory work at Dass Solicitorslast_img read more

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Shorenstein Center announces spring 2015 fellows

first_imgThe Shorenstein Center on Media, Politics and Public Policy at Harvard Kennedy School is pleased to announce the appointment of their spring 2015 fellows.“The line-up of Shorenstein Fellows for the spring semester is a group of all-stars – every one of them,” said Alex S. Jones, the center’s director.Shorenstein Center Fellows spend the academic semester researching, writing, participating in events and interacting with students, faculty and the Harvard community. Since 1986, the fellowship program has welcomed more than 250 accomplished journalists, scholars and politicians from around the globe.The spring 2015 fellows are distinguished leaders in political and investigative reporting, digital governance and technology:William E. Buzenberg is the former executive director of The Center for Public Integrity, a Pulitzer Prize-winning investigative news organization based in Washington, D.C.Jackie Calmes joined The New York Times as a national correspondent in August 2008 and covered the presidential election, the financial crisis and the first five years of the Obama administration.Michele Norris is an award-winning journalist and NPR host and special correspondent. Norris also leads the Peabody Award-winning “The Race Card Project,” an initiative to foster conversations about race and cultural identity.David Weinberger is a senior researcher at Harvard’s Berkman Center and writes about the effect of technology on ideas. Read Full Storylast_img read more

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Victims Outraged with FARC Claim They Don’t Have Hostages

first_img Relatives of victims of the armed conflict in Colombia were outraged on September 6, at the claim by the Revolutionary Armed Forces of Colombia (FARC) that they no longer have hostages in their possession, and they requested a place at the table of peace negotiations between the guerrillas and the government, which will be established in October in Oslo. Dozens of relatives of the abductees and missing assembled on September 6 in Bogotá’s Plaza Bolivar to have their position on the start of a peace process between the communist armed organization and the government of Juan Manuel Santos known. They asked the government for “two famiy members of the kidnapped and two family members of the missing to attend the dialogues as thematic participants” pointed out a statement from the association “The Missing,” read by Colombian journalist Herbin Hoyos. Maria Elena Gálvez, who is seeking information regarding the whereabouts of her father, kidnapped in 1991, asserted to AFP that someone who suffers these crimes “must be present”. The families demanded that the investigation of all their cases be the first item on the agenda that the government and the FARC discuss. They also considered it “unacceptable” that the FARC delegates assured in a news conference in Havana, that a query with all battlefronts concluded that they do not have any captives. “Then where are all the kidnapped and missing people we were fighting for?” Gálvez asked in amazement. In the press conference, the guerrilla commanders hinted that abductions committed by other groups were wrongly attributed to them. The NGO País Libre, which provides help to the families of the hostages, has documented 405 cases of people that would be held by the FARC, but asked the government to disseminate official figures on the kidnapped and missing people, which some organizations say are in the thousands. The FARC announced they were relinquishing the act of kidnapping civilians for extortive purposes in February, and in April, they released the last 10 police and military captives that they said they had. By Dialogo September 10, 2012last_img read more

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Fortress joins Soros to bid for £2bn PFI plan

first_imgTo access this article REGISTER NOWWould you like print copies, app and digital replica access too? SUBSCRIBE for as little as £5 per week. Would you like to read more?Register for free to finish this article.Sign up now for the following benefits:Four FREE articles of your choice per monthBreaking news, comment and analysis from industry experts as it happensChoose from our portfolio of email newsletterslast_img

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