CF Booth Ltd – paying the penalty for re-litigation

Litigating tax assessments particularly where the spectre of the tax penalty regime looms over the proceedings but no penalty has yet been issued is a risky business. Where a taxpayer is found to have known that the transactions on which VAT was incurred were connected with VAT fraud he won’t get a second chance to argue the underlying case in an appeal against a subsequent penalty. This was the case in CF Booth Ltd v CRC [2022] STC 1565.

The First-tier Tribunal found that CF Booth Ltd (CFB) knew or should have known that its transactions were connected with VAT fraud (the missing trader appeal). It subsequently received an FA 2007 Sch 24 penalty on the basis that its VAT return contained a deliberate inaccuracy which it appealed to the First-tier Tribunal (the penalty appeal). This penalty was predicated on the facts from the missing...