HMRC draws on Kvaerner for IPT ruling

A recent legal case involving a subsidiary of DSG International plc has shown that HM Revenue and Customs is beginning to pursue payment of insurance premiums tax by calling on the precedent of the Kvaerner case. Greg Sinfield, partner at law firm Lovells, says that the DSG case has potential implications for many international insurers and their customers

The DSG case is the first time that the UK’s VAT and Duties Tribunal, or indeed any UK court, has had to consider and apply the principles laid down by the European Court of Justice (ECJ) in Kvaerner plc v Staatssecretaris van Financiën (Case C-191/99) [2001] STC 1007 to determine the meaning of the “establishment” of the policyholder and the location of the risk insured. The location of the risk insured is important because it determines the Member State where IPT is payable.