Lack of invoices to show VAT on taxable supplies

Zipvit supplied vitamins and minerals by mail order and used Royal Mail to deliver them. All its supplies were standard rated.

In April 2009 the Court of Justice of the EU ruled in R (on the application of TNT Post UK Ltd) v CRC (Case C-357/07) [2009] STC 1438 that the postal exemption did not apply to supplies negotiated individually. As a result it was accepted that the services supplied by Royal Mail to Zipvit were taxable.

Zipvit then claimed the input tax on the supplies. This raised two questions. First whether VAT was ‘due or paid’ under the Principal VAT Directive Art 168(a) so as to entitle Zipvit to deduct input tax. Second whether the lack of invoices from Royal Mail kiboshed Zipvit’s claim.

The First-tier Tribunal and Upper Tribunal found against the taxpayer so it took the case to the Court of Appeal.

On...