EMJ Telecommunications Ltd v Revenue & Customs [2014] UKFTT 354 (TC) (16 April 2014)
Deduction of input tax is denied because EMJ knew or, at minimum, should have known that its purchases were connected with fraudulent evasion of VAT, based on objective evidence including trading patterns, mark-ups, circularity of funds, and prior warnings.
- Citation
- [2014] UKFTT 354 (TC)
- Parties
- Appellant: EMJ Telecommunications Limited; Respondents: The Commissioners for Her Majesty’s Revenue & Customs
- Jurisdiction
- United Kingdom
- Judgment Date
- 16 April 2014
- Procedural Posture
- VAT Input Tax Appeal / Final Judgment
- Outcome
- Appeal dismissed
- Legal Topics
- VAT Fraud, MTIC Fraud, Input Tax Deduction, Knowledge of Fraud, Contra Trading
Case Brief
Summary, issues, holding and outcome
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Parties
EMJ Telecommunications Limited
Appellant
The Commissioners for Her Majesty’s Revenue & Customs
Respondents
Procedural Posture
VAT Input Tax Appeal / Final Judgment
Legal Issues
- 1 Whether EMJ Telecommunications Ltd knew or should have known its purchases were connected with fraudulent evasion of VAT
- 2 Whether deduction of input tax should be denied under the Kittel principle
Ratio Decidendi
Deduction of input tax is denied because EMJ knew or, at minimum, should have known that its purchases were connected with fraudulent evasion of VAT, based on objective evidence including trading patterns, mark-ups, circularity of funds, and prior warnings.
Court Disposition
Appeal dismissed
Orders
- Deduction of input VAT in the sum of £1,036,297.50 is denied to EMJ Telecommunications Ltd.
- No entitlement to repayment of VAT for periods 05/06 and 06/06.
Full Case Text
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