In Mr & Mrs Kelly T/A Ludbrook Manor Partnership v HMRC [2017] UKUT 0326, the Upper Tribunal (UT) confirmed that a recharge of construction costs when the taxpayer’s changed their minds about who would run the business did not constitute a supply so no VAT could be recovered.
VAT Cases & News
Summaries of interesting VAT cases for the SME owner.
In M J Hickey Plant Hire And Contracts Ltd v HMRC [2017] UKUT 0308, the Upper Tribunal (UT) concluded that a consistent VAT error, where the last day of the quarter was always included in the next VAT return suffered the lower delayed tax penalties, not those calculated under normal rules.
In Summit Electrical Installations Limited v HMRC [2017] TC06006, the First-Tier Tribunal (FTT) ruled that where a building qualifies as both a dwelling and a relevant residential property the subcontractor can give the dwelling precedent and zero rate its supplies.
In HMRC v Languard Homes Ltd and DD & DM Macpherson v HMRC [2017] UKUT 307, the Upper Tribunal concluded that the sale of a converted residential property, which was previously part residential and part commercial, cannot be zero rated.
In J & B Hopkins Ltd v HMRC [2017] TC05874 and J & B Hopkins Ltd [2018] UKUT 0382 a taxpayer could not avoid paying HMRC the VAT assessment merely because it could no longer charge the VAT to its insolvent customer.
In HMRC v Investment Trust Companies (in liquidation) [2017] UKSC 29 the Supreme Court concluded that where HMRC have erred in VAT law, only the business who paid HMRC erroneous VAT can claim it back.
In Gekko & Company Ltd v HMRC [2017] TC06029 the First Tier Tribunal (FTT) heavily criticised HMRC’s handling of the (VAT) case and went so far as to award costs against HMRC.