Appeal against late VAT registration assessment and penalty

HMRC said the taxpayer should have registered for VAT between 25 October 2014 and 15 May 2015. In the absence of a VAT return it assessed tax of £10 458 using its powers of ‘best judgment’ (VATA 1994 s 73(1)). The assessment was raised on 10 June 2016 and a penalty was assessed on 5 September 2016 for £5 490.

The taxpayer did not receive either notice because he had moved house with no post-forwarding arrangement in place. It was not until July 2018 that he became aware of them when HMRC issued a statutory demand concerning the arrears. He then appointed an accountant to deal with his appeal to HMRC on the basis that he had no liability to register for VAT because the sales in question had been made by a separate entity.

After considerable correspondence between the accountant and HMRC the taxpayer lodged an...