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Red 12 Trading Ltd v CRC, Chancery Division
HMRC refused the taxpayer’s claim to deduct input tax in respect of transactions relating to the sale of mobile phones. The taxpayer appealed.
The tribunal dismissed the appeal, saying the transactions were part of a missing trader fraud.
Furthermore, while the company may not have been involved in the fraud, the director knew that some other trader further up the chain of supply would fail to account for output tax.
The company appealed.
The High Court said that the tribunal’s conclusions were reached in a proper way. It had examined each transaction and its decision was consistent and supported by the evidence.
The taxpayer’s appeal was dismissed.
