Claim for overpaid VAT on fees charged to bingo players

The taxpayer operated bingo clubs. Customers paid a fee to participate in a session. A dispute arose from a change in HMRC’s guidance about how participation fees should be calculated. In February 2007 HMRC issued Business Brief 07/07 which stated that participation fees should be calculated on a session-by-session basis. Before this bingo promoters had to calculate the fees separately for each game.

After the brief was issued the taxpayer made a claim under VATA 1994 s 80 for repayment of sums overpaid as a result of having used the old basis of calculation. This was repaid.

The taxpayer later claimed a refund for the years 1996-2004. To overcome the time limit the taxpayer argued that both methods were legitimate. As such when using the game-by-game method it was paying tax that was due so the time limit did not apply HMRC refused. The taxpayer...