In G B Fleet Hire Limited v HMRC [2021] UKUT0225, the Upper Tribunal (UT) allowed an appeal against a First Tier Tribunal (FTT) decision to strike out the taxpayers claim. The FTT had wrongly concluded the taxpayer had dropped its case that supplies were zero-rated.
- The underlying tax dispute concerned whether the supply of vehicles exported to Ireland and the Far East were zero-rated which would allow an input tax reclaim.
- The FTT struck out the case after considering that a letter sent by representatives of G B Fleet Hire Limited (GBFH) to HMRC abandoned its case that the supplies were zero-rated and that as a result, the appeal had no prospect of success.
- The taxpayer appealed against the strikeout to the Upper Tribunal contending its case was maintained.
The UT allowed the appeal finding that:
- The FTT erred in law and the decision to strike out the appeal was irrational.
- The extract of the letter on which the strikeout was based was contradictory:
- Accepting that some items were not zero-rated, while
- Maintaining that input tax could be claimed where, in the absence of a zero rating, no entitlement to reclaim would arise.
- The FTT did not consider that the letter as a whole made it clear the taxpayer maintained that it can reclaim input tax and did not consider whether any other mechanism was available for such a reclaim.
- There were also relevant documents, which the FTT failed to consider, which indicated the taxpayer had not dropped their position that the supplies were zero-rated.
Useful guides on this topic
Appeals: VAT
The process of making a VAT appeal largely follows that of direct taxes, however, there are some differences.
How do I appeal an HMRC decision? How do I appeal a penalty? How can I request a Statutory Review?
VAT Toolkit
This is our summary version of HMRC's output and input VAT toolkits, our version includes more detail, topics and planning points.
External links
G B Fleet Hire Limited v HMRC [2021] UKUT0225
