Three-year hiatus

The House of Lords dismissed the HMRC's appeals in Condé Nast Publications and Fleming (trading as Bodycraft). The law lords held that the introduction of a three-year limitation period for the recovery of input VAT in 1997 with no transitional period was unlawful.

Condé Nast had claimed repayment in respect of under-deduction of input tax in accounting periods from 1 April 1973 to 30 April 1997. HMRC rejected the claim relying on the three-year time limit for making repayment claims imposed by reg 29(1A) of the VAT Regulations 1995 SI 1995/2518.

The facts in Fleming are in brief that in 1989 and 1990 the taxpayer bought 13 Aston Martin motor cars for the purpose of his business. He reclaimed the VAT on ten of the cars.

However as he did not receive VAT invoices when he bought the other three cars he...