Share this content
A map of Africa

VAT: Taxpayer’s proof of export accepted on appeal


HMRC refused to accept alternative evidence of the export of goods. Was this due to prejudice on behalf of the officer, or a misunderstanding of how trade is conducted in parts of Africa?

9th Sep 2021
Share this content

HMRC has discretion to accept documents other than valid invoices to support input VAT claims and the zero-rating of exports. But what happens when it does not exercise this discretion?

The case of BJ Trading Ltd vs HMRC (TC8150) illustrates how the first tier tribunal (FTT) can impose a solution.


Mr Dike, a Nigerian national, had traded for several years when he incorporated and formed BJ Trading Ltd (BJ), a Northern Irish company, in March 2016. The company purchased second-hand clothing from the Republic of Ireland and exported it, mainly to Africa.

Exports were always made through a shipping agent and occasionally the customer would arrange the shipping.

HMRC visits

HMRC made several visits to BJ’s accountants in 2017 before issuing a letter refusing to allow several of the exports to be zero-rating on the basis the paperwork did not satisfy the requirements in Notice 703.

Several claims for input tax recovery were also refused as the purchase invoices did not show the information required by Regulation 29(2).

Apparently Dike and the HMRC officer, Baxter, had met before and had a less than cordial relationship. Dike stated he felt that Baxter was discriminating against him and requested a review.

HMRC review

Another HMRC officer, Johnstone, reviewed the initial decision to refuse zero-rating claims and reached the same conclusion as Baxter.

Register for free to continue reading

It’s 100% free and provides unlimited access to the latest accounting news, advice and insight every day. As well as access to this exclusive article, you can:

View all AccountingWEB content
Comment on articles
Watch our digital shows and more

Access content now

Already have an account?

Replies (2)

Please login or register to join the discussion.

By johnjenkins
10th Sep 2021 10:15

When you look at letters etc. coming from Nigeria trying to scam people and HMRC only vetoed the paperwork with discrepancies, then you get a clearer picture of HMRC thinking. I have dealt with companies in Nigeria and Tanzania (through companies in Jersey) years ago and to say they do business differently is an understatement. That is not to say that Mr Dike is not a kosha business man.

Thanks (0)
By Hugo Fair
13th Sep 2021 17:29

Unfortunately HMRC have no cultural concept of "The past is a foreign country; they do things differently there" - either in the original sense or merely any non-UK behaviour they encounter.
Their approach is always "My way or the highway" ... which is why MTD will be such a car-crash (even for the relatively straightforward ways in which business is conducted within the UK).

Thanks (1)