Mobile phone trader wins VAT appeal | AccountingWEB

Mobile phone trader wins VAT appeal

Mobile phone trader CCA Distribution Limited has been thrown a lifeline after winning a legal appeal against HMRC’s decision to withhold VAT re-payments worth about £10m. The victory for the business, which is in administration, is likely to encourage other traders who have similar tribunal appeals against HMRC.

HMRC claimed that the Stockport-based business knew that it was part of a “contra trading” fraud relating to handsets traded in the UK and Europe between April and June 2006.

Under contra trading fraud, a variation of “missing trader” fraud, people try to evade VAT by participates in two separate types of transaction during the same VAT period. One of the transaction chains is legitimate, the other isn’t. The output tax from one chain is designed to off-set the input tax incurred on the other chain. 

VAT fraud is estimated to cost...


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Tied decisions and the casting vote of the Chairman

hjaflood | | Permalink

One all and all that !

Skim readers of this decision might be confused that the head note indicates the appeal is allowed and the last paragraph records that the appeal is dismissed. This is explained by the unusual situation of there being a difference between the Chairman's view and the member's view. This means, to begin with, a 1 1 decision, but In this situation the Chairman then has a casting vote.

The Chairman's part of the decision ends at paragraph  411 and it is followed by a statement of dissent which ends with the  words mentioned above hence the apparent, but not real contradiction.

Perhaps the moral of the story is the importance of having an odd number for a Tribunal. .

John Flood

Malcolm McFarlin's picture

HMRC to appeal

Malcolm McFarlin | | Permalink

On the basis of 'tied decision' it seems an absolute certainty that HMRC will appeal the decision to the Upper Tax Tribunal. The battle may be won but not the war.

Malcolm McFarlin