Reimbursement of employee-related costs

“As a result of the foregoing, the Tribunal finds that the payments made to the Appellant for reimbursement of employee-related costs are not vatable as they constitute reimbursements of employee salaries and emoluments and therefore not chargeable to VAT. Consequently, the Tribunal finds that the Respondent was not justified in raising the VAT assessment on the total pay received by the Appellant from its clients as only VAT on the service element was taxable and this was accounted for by the Appellant.”