Taxpayer’s errors were a mix of careless and deliberate

The taxpayer was a sole trader in the healthcare industry. After an compliance visit during which HMRC identified several basic input and output tax errors that it said had been made deliberately by the taxpayer the department issued a penalty of £11 671.

Among the errors were that the taxpayer accounted for no output tax on VAT returns submitted for the periods between 2011 and 2015 but instead claimed the VAT charged on his sales invoices as input tax. There was also no input tax listing to support the amounts claimed on his returns; items such as meals and fuel were claimed that were not allowable and he claimed 100% input tax on his golf club membership fees claiming he could use meeting rooms at the club as a benefit of being a member. HMRC accepted a 10% claim could be made on the club membership but disallowed...