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Birmingham Hippodrome Theatre Trust v CRC, Upper Tribunal (Tax and Chancery Chamber)
The taxpayer incorrectly accounted for output tax on supplies that were exempt between 1990 and 2004.
The organisation claimed, in 2006, repayment of the overpaid VAT for the periods covering 1990 to 1996.
The department said the claim was out of time and added it made a repayment of input tax in 2000 and 2001, which should not have been made because the outputs were exempt.
As a result, the Revenue are entitled under VATA 2004, s 81(3A) to offset the input tax wrongly repaid against the output tax claimed.
The Upper Tribunal agreed with the First-tier Tribunal that s 81(3A) permitted HMRC to offset the incorrect repayment against the output tax overpayment.
A mistake had been made by treating the taxpayer’s ticket sales as standard rated, which was the reason for the overpaid out tax and repaid input tax.
The taxpayer’s appeal was dismissed.
