.png)
.png)
Do your homework
Key points
- In some circumstances HMRC has the power to deny a taxpayer its right to deduct input tax or to deny or deregister a trader from VAT.
- The taxpayer must have known or should have known that its transactions were connected with VAT fraud.
- The tribunal has examined the specific definition and application of the ‘known or should have known tests’.
- Proper due diligence procedures are the best defence against these HMRC decisions.
It is not often that HMRC is presented with novel investigative powers through new legislation. Instead it is often landmark cases which test both HMRC’s and the court’s understanding of specific principles which vary and expand how existing powers may be used.
An example is the European Court of Justice’s (ECJ’s) ruling in Kittel v Belgium (C-439/04) [2006] STC 1537 which has had a continued impact on how HMRC tackles VAT fraud within
Alternatively, you can register free of charge to read a limited amount of subscriber content per month.
Once you have registered, you will receive an email directing you back to read this item in full.
