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The taxpayer first encountered problems with HMRC in 2015 over its operation of the global accounting scheme. Businesses that buy and sell low value second-hand goods use this scheme because it allows them to declare output tax on the profit margin rather than the full selling price. The HMRC enquiry lasted a long time and repayment returns were delayed until the issues were resolved. For many periods HMRC adjusted the repayment VAT returns claims submitted by the company due to errors made.
The taxpayer submitted a claim for £17 868 from HMRC on the basis that it had incurred bank and credit card interest and fees as a result of the repayment delays. This sum also included a claim for £5 200 for ‘wasted director’s costs.’
HMRC accepted that there had been a delay of more than 30 days in dealing with the repayment claims and paid repayment...
