Change not allowed

Mrs A a chartered accountant and director of the taxpayer company wished to backdate a change in the category of her business under the flat rate scheme for VAT. The business was registered for VAT flat rate scheme under the accountancy category in March 2007.

However it transpired that most of the business was providing tax advice to investment funds and management companies with some exam marking.

So in February 2009 Mrs A advised HMRC that she should have selected the ‘business services not listed elsewhere’ option. She asked if she could backdate the change to 2007 and recalculate her VAT accordingly.

The department refused to backdate the change on the basis that it was its policy not to do so. Mrs A asked to have the decision reviewed but this did not result in any change. So Mrs A appealed.

The...