Unreliable records

HMRC’s best judgment in raising an assessment based on till roll analysis

The taxpayer sold second-hand mobile phones. HMRC investigated the business’s till rolls. The taxpayer’s adviser admitted that the till rolls could not be relied on because of errors made by staff and directors. After analysing the information HMRC raised an assessment under VATA 1994 s 73 to collect underdeclared VAT and a separate assessment for road fuel scale charges for a car on the basis that it was used partly for private purposes. The trader appealed.

The First-tier Tribunal criticised HMRC’s methodology and reduced the figures for returns. However it accepted that the car had some private use because the director drove from his home to office in the vehicle.

The taxpayer’s appeal was allowed in part.

Neil Warren independent VAT consultant said: ‘The taxpayer seems to have come out with a very...