The Upper Tribunal ruled that Lycamobile UK must pay more than £50 million in VAT, requiring the operator to charge VAT on the full price of prepaid mobile bundles at the point of sale, rather than only on services actually used. The decision, dated 12 Feb 2026, overturns Lycamobile's previous VAT calculation method.
It ruled that Lycamobile must pay VAT on the full price of mobile plan bundles at the point of sale, resulting in more than £50 million payable.
The decision was dated 12 Feb 2026.
Previously VAT was calculated only on services used; now VAT is due on the full bundle price at sale.
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