VAT Update 2 - HMRC v Sonder Europe Ltd [2025] UKUT 00014 (TCC)

By Debbie Franklin, Director of Tax and property tax specialist

Following the last post about this case on 17 January, essentially, Rent to Serviced Accommodation operators have the following options:

• Where turnover is below £90k, the business is not affected. However, there is a need for business owners to plan how to scale differently.
• Where turnover is equal to or more than £90k, business owners need to decide between:
• Registering for the Flat Rate scheme or full VAT (if reduced value rule can be utilised).
• Retaining the same business model or changing to a more management/commission based structure.
• Or, if the business is not viable at all, closing down the company.

For a copy of our briefing providing more information, email enquiries@peplows.co.uk