VAT valuation of part-exchange consideration follows the agreed contractual price, not a lower figure used for cancellation purposes.

For VAT purposes, the taxable amount for non-monetary consideration in a part-exchange car transaction is the consideration actually agreed by the parties, not a lower figure recorded for a separate contractual purpose. The documentation showed that the negotiated part-exchange price was the value adopted for the transaction, while the lower "true value" was used only to limit any refund on cancellation. Fiscal neutrality did not require that commercially similar structures be treated as identical where the legal attribution of value was different. The agreed part-exchange price therefore remained the proper monetary equivalent for VAT, and the lower figure could not be substituted as a discount.

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Issues: Whether, for VAT purposes, the monetary equivalent of the non-monetary consideration in a part-exchange car transaction was the full part-exchange price or the lower "true value" recorded on the dealer's form.

Analysis: The governing VAT principle was that the taxable amount is the consideration actually obtained, and non-monetary consideration must be valued by its subjective value, namely the value the parties have themselves attributed to it in the transaction. The documentation used in these transactions recorded both a part-exchange price and a separate "true value", but the latter served a distinct purpose, namely limiting the refund if the customer cancelled the purchase. The part-exchange price was the figure negotiated and adopted for the transaction, and the finance-company paperwork also proceeded on that basis. The principle of fiscal neutrality did not require economically similar commercial structures to be treated as identical for VAT purposes, because the transactions were not legally identical and the supplier was entitled to choose the form of attribution that it documented.

Conclusion: The full part-exchange price, and not the lower "true value", was the proper monetary equivalent for VAT. The appeal failed.

Ratio Decidendi: Where the parties to a taxable transaction have attributed a monetary value to non-monetary consideration, that agreed value determines the taxable amount for VAT unless the statutory scheme requires a different treatment; fiscal neutrality does not permit recharacterising a genuine contractual attribution of value as a discount.

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