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Was the separate hire of a car seat a separate supply from the hire of the car?

By Andrew Needham, September 2020

This appeal concerned whether the letting of a car with a child car seat by the appellant, a car rental company was, for VAT purposes, a single composite supply, as HMRC contended, or separate supplies of the car (standard rated) and the car seat (reduced rate of 5%), as the appellant contended. 

Summary 

This appeal concerned whether the letting of a car with a child car seat by the appellant, a car rental company was, for VAT purposes, a single composite supply, as HMRC contended, or separate supplies of the car (standard rated) and the car seat (reduced rate of 5%), as the appellant contended. 

Background 

HMRC refused a voluntary disclosure seeking repayment of overpaid output tax during the period 1 October 2008 to 31 December 2015 in the total sum of £631,178 submitted by the appellant. 

 A car hirer could, as an optional extra, hire a

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