Prepare properly for your Tribunal Hearing!

Les Howard
VAT Consultant
vatadvice.org
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I was reading a FTT case which was messy, as a result of poor preparation by both parties., particularly the taxpayer. This left the Tribunal Chairman struggling to provide a coherent decision.

Amongst the serious omissions was the failure of the taxpayer to provide essential documentation (Sales Contracts) to explain the way the business sold it services.

I was given no explanation of the reason the contract could not have been put in evidence’ (para 80). ‘I have no documentary evidence, there are no contracts, no invoices, no purchase orders, no letters, no emails, nothing at all…’ (para 84).

The taxpayer’s argument at the Hearing did not follow its skeleton argument.

The taxpayer introduced additional argument the day before the hearing.

VAT legislation and case law was misquoted by both parties.

In para 31, the decision comments; “I asked the parties to tell me what the relevant law was, but neither knew” !!

The substantive issue was the sale of lodges, with removable contents, and a licence to site the lodge on a specific plot of land. The taxpayer broke down the supply into different VAT liabilities, making no mark up on the taxable portion, and making profit on the exempt portion (plot of land). At para 64 the Tribunal accepted this broad analysis, and held that the taxpayer’s approach in the way it attributed values was ‘fair and reasonable.’ (Yes, I was surprised too!)

The sting in the tail was that the Tribunal held that the supply of land was excluded from exemption, and therefore standard rated (item 1(f) of exempt Group 1).

A failure to prepare properly for a Tribunal will put a taxpayer at a real disadvantage. If you want your ‘day in court,’ then make sure you invest properly in preparation and representation.

You can read the decision here: http://financeandtax.decisions.tribunals.gov.uk//Aspx/view.aspx?id=9546

About Les Howard

chips_at_mattersey

Hi, I am a VAT Consultant, working mainly with charities. I am based in Cambridgeshire

I have over 20 years experience in VAT, and am currently also a part-time member of the Tax Tribunals.

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