‘Property Search VAT confusion set to continue’ (Gazette, 4 June) discussed the effect of the decision in Brabners LLP v The Commissioners for HMRC.
It is important to note that this decision has created a peculiar situation, whereby HMRC allows conveyancers to invoice postal searches as disbursements, but requires electronic searches to be invoiced as part of the services supplied (which are subject to VAT).
It is illogical that the same reasoning applied by Judge Christopher McNall in relation to electronic searches (that is, obtaining searches forms part of the firm’s services to the client and is chargeable as such) is not also applied to postal searches.
HMRC should issue urgent guidance to clarify what is an extremely confusing situation for conveyancers and our clients.
Matt Cowen, Solicitor, Winckworth Sherwood LLP, London SE1