DI & GI Electronics Ltd v Revenue & Customs [2011] UKFTT 825 (TC) (14 December 2011)

DI & GI Electronics Ltd v Revenue & Customs [2011] UKFTT 825 (TC) (14 December 2011)

The Tribunal found, on the balance of probabilities, that the appellant knew its transactions were connected with VAT fraud. The circumstantial evidence, including the ease and structure of the deals, the uniform mark-up, and the appellant's conduct, established actual knowledge of the connection with fraud. Therefore, input tax deduction was denied under the principles in Kittel and Mobilx.

Citation
[2011] UKFTT 825 (TC)
Parties
Appellant: DI & GI Electronics Ltd; Respondents: The Commissioners for Her Majesty’s Revenue and Customs
Jurisdiction
United Kingdom
Judgment Date
14 December 2011
Procedural Posture
VAT Input Tax Appeal (mtic Fraud) / First Tier Tribunal (tax), Final Decision
Outcome
Appeal dismissed
Legal Topics
VAT Fraud, Input Tax Deduction, MTIC (missing Trader Intra Community) Fraud, Contra Trading, Knowledge Requirement for Denial of Input Tax
Tax Law European Union Law VAT Fraud Input Tax Deduction MTIC (missing Trader Intra Community) Fraud Contra Trading Knowledge Requirement for Denial of Input Tax

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Parties

DI & GI Electronics Ltd

Appellant

The Commissioners for Her Majesty’s Revenue and Customs

Respondents

Procedural Posture

VAT Input Tax Appeal (mtic Fraud) / First Tier Tribunal (tax), Final Decision

Legal Issues

  1. 1 Whether the appellant knew or should have known its transactions were connected with VAT fraud
  2. 2 Whether input tax should be denied in a contra-trading MTIC fraud context

Ratio Decidendi

The Tribunal found, on the balance of probabilities, that the appellant knew its transactions were connected with VAT fraud. The circumstantial evidence, including the ease and structure of the deals, the uniform mark-up, and the appellant's conduct, established actual knowledge of the connection with fraud. Therefore, input tax deduction was denied under the principles in Kittel and Mobilx.

Court Disposition

Appeal dismissed

Orders

  • The appellant is not entitled to the input tax in question.
  • Any application for costs to be made within 42 days of the decision's release.