In Anthony Leach v HMRC [2019] TC 7180, the first tier tribunal found that a trader’s excessive claims for refunds of VAT was as a result of “deliberate and concealed” behaviour. The consequence is that HMRC can claim tax for the previous 20 years rather than four, and that the highest rates of penalty apply.

  • The trader routinely destroyed all supporting paperwork immediately after filing his VAT return, saying he did not know it had to be kept for six years.
  • After a VAT visit when he started to keep records, his input tax claims for the same basis were one eighth of the previous figures.
  • HMRC raised assessments based on their best judgement of the loss for VAT of £49,857 and penalty of £47,364.

On appeal, the first tier tribunal found that destruction of records constitutes concealment and this was deliberate. 

 The assessments and penalties were upheld.

 Useful guides

Penalties and compliance

Best judgement assessments

External links

Anthony Leach [2019] TC 7180