Company’s appeal was wrongly struck out

In August 2020 HMRC refused to register the taxpayer – GB Fleet Hire - for VAT. The taxpayer appealed to the First-tier Tribunal. The tribunal agreed to HMRC’s application to strike out the appeal on the basis that there was no reasonable prospect of the taxpayer’s case succeeding. The company appealed to the Upper Tribunal.

The Upper Tribunal noted that the company had previously been compulsory deregistered for VAT in 2017 on the basis that its registration was being used abusively and HMRC’s reason for not proceeding with its 2020 VAT registration application was because the compulsory cancellation was currently under appeal.

In deciding the appeal had no chance of success the First-tier Tribunal had relied on its conclusion that the company had not shown that it addressed the abuse leading to the cancelled registration in 2017. This was wrong because the burden of proof to show that the 2020...