Application to amend grounds of appeal refused

The taxpayer C4C made VAT input tax claims in respect of purchases from DBR Ltd but the latter did not account for VAT. The sole director of DBR was also the operations manager of C4C and had responsibility for VAT compliance for both companies. HMRC denied the claims on the basis that the taxpayer knew or should have known that it was participating in a transaction connected with the fraudulent evasion of VAT. HMRC imposed penalties for deliberate inaccuracies in a VAT return under FA 2017 Sch 24.

The taxpayer appealed saying initially that the level of the penalties imposed should have been lower. However as HMRC’s statement of case noted the taxpayer did not challenge the contention that it had taken part in a fraudulent evasion of VAT or the alleged deliberate inaccuracies in its VAT returns.

As a result the...