Gold bullion was never available to be delivered

The taxpayer bought gold bullion from a supplier following orders from customers. It then sold the gold to customers. However the customers waived their right to take delivery or have physical possession of the gold which remained in the supplier’s vault. It was the legal title to it that changed.

The supply of investment gold is exempt from VAT under VATA 1994 Sch 9 Group 15. Businesses that supply it are subject to special invoicing and record keeping requirements under the VAT Regulations SI 1995/2518 reg 31A as may be specified in a notice namely Notice 701/21 published by HMRC. There are specific requirements as to where gold is delivered or otherwise made available to the customer.  

HMRC issued the taxpayer a penalty under VATA 1994 s 69A for failing to comply with these requirements.

The First-tier Tribunal dismissed the taxpayer’s appeal and...