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In Zipvit Limited v HMRC [2022] UKSC12, the Supreme Court issued a second judgement dismissing the appellant's appeal to reclaim input VAT on services where the supplier, Royal Mail, had incorrectly not charged VAT. The judgement was made after the case had been referred to the Court of Justice of the European Union (CJEU).

The Supreme Court accepted the CJEU ruling on whether VAT had been paid. In relation to the matter of discretion, the First Tier Tribunal found that HMRC had not considered whether or not to apply discretion. However, it held that had the matter been considered, HMRC would have decided not to accept the claim.

The appeal was dismissed.

This was a test case for claims where the same mistake was made by Royal Mail. The claims for input VAT being made against HMRC are estimated to be between £500 million and £1 billion.

Useful guides on this topic

No input recovery as VAT was not due or paid
In Zipvit Ltd v HMRC (Case C-156/20) (13 January 2022), the CJEU found that VAT was not due or paid on Mailmedia services supplied by Royal Mail. This blocked Zipvit Ltd from recovering input VAT on the supplies.

What constitutes a valid VAT invoice?
What needs to be included on a VAT invoice? Can you claim back VAT without an invoice? What evidence do you need to claim input VAT? A valid VAT invoice is required to reclaim input VAT. HMRC have the discretion to allow defective invoices. 

Reclaims and unjust enrichment
When can VAT reclaims be made? What are the time limits? What is unjust enrichment? Why might unjust enrichment prevent HMRC making VAT repayments? 

External link

Zipvit Limited v HMRC [2022] UKSC12


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