4
(1)
This paragraph applies to a face-value voucher issued by a person who—
(a)
is a person from whom goods or services may be obtained by the use of the voucher, and
(b)
if there are other such persons, undertakes to give complete or partial reimbursement to those from whom goods or services are so obtained.
Such a voucher is referred to in this Schedule as a “retailer voucher”.
(2)
The consideration for the issue of a retailer voucher shall be disregarded for the purposes of this Act except to the extent (if any) that it exceeds the face value of the voucher.
(3)
Sub-paragraph (2) above does not apply if—
(a)
the voucher is used to obtain goods or services from a person other than the issuer, and
(b)
that person fails to account for any of the
VAT due on the supply of those goods or services to the person using the voucher to obtain them.
(4)
Any supply of a retailer voucher subsequent to the issue of it shall be treated in the same way as the supply of a voucher to which paragraph 6 below applies.
Cases considering Schedule 10A, paragraph 4 5
[2017] EWCA Civ 54 · 10 February 2017
Paragraph 4(2) disregards consideration for directly issued retailer vouchers up to face value. It therefore renders that issue non-taxable, leaving VAT to be accounted for on redemption and preventing input-tax deduction by the purchaser (see paras [76]-[86]).
[2009] EWHC 1077 (Ch) · 20 May 2009Limits
The provision defines a retailer voucher by reference to the issuer’s ability to supply the goods or services and any reimbursement undertaking. It is used to distinguish retailer vouchers from credit vouchers. (see para [14]; [16])
The provision disregards consideration on the issue of a retailer voucher except to the extent it exceeds face value. It forms part of the contrast with the treatment of subsequent supplies. (see paras [14]; [16])
The provision is cited as an exception to the disregard where a retailer voucher is used with a person other than the issuer and that person fails to account for VAT. It is not central to the final construction. (see para [14])
The provision is cited as part of the retailer-voucher exception to the disregard. The judgment does not separately construe this sub-paragraph. (see para [14])
The provision treats a subsequent supply of a retailer voucher in the same way as a supply within paragraph 6. It supports the conclusion that subsequent retailer-voucher supplies are ordinarily chargeable at the standard rate. (see para [14]; [16])
[2004] EWHC 3188 (Admin) · 21 December 2004Disapplies
The court rejected the contention that the cards were retailer vouchers. Paragraph 4 did not apply because ICSIL and Interdirect were separate legally independent persons. (see paras [25]-[26]; [63]-[66])
The court considered paragraph 4(4) as the provision that would make a subsequent supply of a retailer voucher taxable under paragraph 6. That route was unavailable because the cards were not retailer vouchers. (see paras [26]; [63]-[66])
What each judgment says about Schedule 10A, paragraph 4 is in the case-law panel in the full Act.