The European Court of Justice decision into the VAT liability of the Royal Mail means online retailers could make a refund claim, according to one accountant.

Online retailers which have contracts with the Royal Mail have been urged to make a VAT refund claim following a decision by the European Court of Justice (ECJ).

The ECJ has released its findings into an investigation into the VAT liability of Royal Mail.

Hannah Dobson, VAT director at accountancy firm Smith & Williamson, claims the new decision means that some retailers who have negotiated contracts on individual terms are "no longer exempt" from paying the tax.

She added: "The High Court in the UK needs to determine the exact services of Royal Mail that should be subject to VAT, but in the meantime businesses which have had a contract with Royal Mail at any time since 2000 should submit a protective VAT claim."

Companies with individual services previously billed as VAT-exempt by Royal Mail could now be see them treated as VAT-inclusive services, she states, meaning the relevant amount previously paid could now be claimed back.

The Communication Workers Union has planned a May Day rally to protest against the proposed partial privatisation of the Royal Mail.


Article Added: 01/05/2009 09:27:51