VAT surprise for dealing rooms

VAT surprise for dealing rooms

Banks could save hundreds of millions of pounds in VAT because of a surprise ruling by a tribunal that tax on the expenses of running dealing rooms is recoverable. Jeff McCloud of Coopers & Lybrand, the accountants, said that Customs & Excise had been surprised to lose the case, which was brought by First National Bank of Chicago. He now expects a flood of claims from other banks, and some could be retrospective. The ruling applies to foreign exchange dealings in London with counterparties outside the European Union, such as the US and Japan.