Generous Tax Tribunal
The First Tier Tax Tribunal operates a flexible approach towards litigants in person (self-represented taxpayers). They are usually unfamiliar with the Tribunal process, and mix up evidence with legal argument, etc. The Tribunal will therefore assist them to present their case fairly.
The case of The Door Specialist Ltd is slightly different, as the taxpayer was represented by a tax professional. Even so, the Tribunal seems to have been very flexible.
- First, the late appeal was allowed with little argument.
- Second, the taxpayer had failed to provide a skeleton argument, even though formal Directions had been made for this.
- Third, the taxpayer asked for new evidence to be admitted late.
- And fourth, the taxpayer had proposed new grounds of appeal very late. The Tribunal allowed these grounds to be presented.
Turning to the substantive point, the issue was novel. The taxpayer company had imported doors, on which it had claimed around £80,000 of input tax during 2015 to 2017. It then gave away those doors to a series of apparently unregistered companies, who sold them on. The argument was that the gift of the doors constituted supplies in the course of business, which allowed input tax recovery. (I do wonder if there is a back-story involving the series of unregistered companies, but the FTT did not mention any perceived avoidance scheme. Doubtless, HMRC’s denial of the input tax was sufficient to defeat the arrangement in any case.)
The Tribunal tersely commented, ‘We are not persuaded by Mr Thomas’ (for the taxpayer) argument.’
You can read the entire novel argument here:
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Hi, I am a VAT Consultant, part of the team at vatadvice.org We are based in Cambridgeshire. We work largely with charities but also advise a range of commercial organisations.
I have over 30 years experience in VAT, and am currently also a part-time member of the Tax Tribunals.