Masstech Ltd v Revenue & Customs [2010] UKFTT 386 (TC) (18 August 2010)

Masstech Ltd v Revenue & Customs [2010] UKFTT 386 (TC) (18 August 2010)

HMRC failed, on the balance of probabilities, to establish that the Appellant, through its director, was aware of MTIC fraud or had the means of knowledge that its transaction was connected to fraudulent evasion of VAT. The Tribunal accepted that the Appellant was not required to ignore its director's ignorance in...

Source-derived case information.

Citation
[2010] UKFTT 386 (TC)
Parties
Appellant: Masstech Limited; Respondents: The Commissioners for Her Majesty’s Revenue and Customs
Jurisdiction
United Kingdom
Judgment Date
18 August 2010
Procedural Posture
VAT Input Tax Appeal / First Tier Tribunal (tax) Final Decision
Outcome
Appeal allowed
Legal Topics
MTIC Fraud, Input Tax Denial, Kittel Test, Means of Knowledge, Due Diligence
Tax Law VAT Fraud MTIC Fraud Input Tax Denial Kittel Test Means of Knowledge Due Diligence

Source-derived case record

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 3 Authorities cited 4 Party arguments 2 Amounts and remedies 5
Sign in to unlock

Parties

Masstech Limited

Appellant

The Commissioners for Her Majesty’s Revenue and Customs

Respondents

Procedural Posture

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

Legal Issues

  1. 1 Whether the Appellant knew or ought to have known its transaction was connected with MTIC fraud
  2. 2 Application of the 'ought to have known' limb of the Kittel test in circumstances of alleged ignorance
  3. 3 Assessment of evidence regarding Appellant's knowledge and due diligence

Ratio Decidendi

HMRC failed, on the balance of probabilities, to establish that the Appellant, through its director, was aware of MTIC fraud or had the means of knowledge that its transaction was connected to fraudulent evasion of VAT. The Tribunal accepted that the Appellant was not required to ignore its director's ignorance in assessing the 'ought to have known' test, and found insufficient evidence to justify denial of input tax recovery.

Court Disposition

Appeal allowed

Orders

  • Input tax claim reinstated
  • HMRC to process VAT repayment to Appellant