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The taxpayer company Chain Telecommunications bought Globalink International in 2008.
In its VAT return for the period to April 2009 Chain claimed a net repayment which included input tax paid in respect of invoices addressed to Globalink.
HMRC disallowed the tax in relation to the invoices because they were for supplies to a third party.
The taxpayer company appealed.
The First-tier Tribunal said that based on ‘limited’ evidence it was satisfied Chain had paid the invoices. The question under VATA 1994 s 24(1)(a) was whether the supplies of services paid for were used by Chain.
The tribunal concluded they were not and the VAT paid by Chain in settling the invoices did not constitute input tax.
The company’s appeal was dismissed.
Even if a business has a purchase invoice addressed to it which it pays input tax cannot...
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