Too little evidence

The taxpayer was a health authority that submitted a claim to recover input tax paid on capital expenditure during a 23-year period from 1974 to 1997.

It was made in light of the decision in Fleming (t/a Bodycraft) v CRC [2008] STC 324 which restored traders’ right to recover under-claimed input VAT for periods back to 1973.

HMRC rejected the taxpayer’s claim.

The First-tier Tribunal (FTT) dismissed the taxpayer’s appeal on the ground that the health authority had failed to provide evidence of the amount of unrecovered input VAT.

The taxpayer appealed.

The Upper Tribunal said the FTT had proceeded on the basis there had probably been an under-recovery by the taxpayer of input tax on capital expenditure and the lower tribunal “did not regard itself as requiring an unreasonably high standard of accuracy in the computation of the appellant’s claim”.

But the FTT considered that the evidence...