Totel Distribution Ltd v Revenue & Customs [2011] UKFTT 217 (TC) (31 March 2011)

Totel Distribution Ltd v Revenue & Customs [2011] UKFTT 217 (TC) (31 March 2011)

The Tribunal found that the appellant's transactions were connected with fraudulent evasion of VAT and that the appellant, through its director, knew or ought to have known of this connection. The evidence showed that the appellant traded on vague and inconsistent terms, often before due diligence was completed, and that the trading arrangements were contrived and indicative of knowledge of fraud. Therefore, the input tax claims were properly refused.

Citation
[2011] UKFTT 217
Parties
Appellant: Totel Distribution Ltd; Respondents: The Commissioners for Her Majesty’s Revenue and Customs
Jurisdiction
United Kingdom
Judgment Date
31 March 2011
Procedural Posture
VAT Appeal (first Tier Tribunal Tax) / Final Judgment After Full Hearing
Outcome
Appeal dismissed
Legal Topics
Input Tax Recovery, Missing Trader Intra Community (mtic) Fraud, Contra Trading, Knowledge of Fraud, Evasion of VAT
Tax Law VAT Input Tax Recovery Missing Trader Intra Community (mtic) Fraud Contra Trading Knowledge of Fraud Evasion of VAT

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Parties

Totel Distribution Ltd

Appellant

The Commissioners for Her Majesty’s Revenue and Customs

Respondents

Procedural Posture

VAT Appeal (first Tier Tribunal Tax) / Final Judgment After Full Hearing

Legal Issues

  1. 1 Whether the appellant's transactions were connected with the fraudulent evasion of VAT
  2. 2 Whether the appellant knew or ought to have known of that connection

Ratio Decidendi

The Tribunal found that the appellant's transactions were connected with fraudulent evasion of VAT and that the appellant, through its director, knew or ought to have known of this connection. The evidence showed that the appellant traded on vague and inconsistent terms, often before due diligence was completed, and that the trading arrangements were contrived and indicative of knowledge of fraud. Therefore, the input tax claims were properly refused.

Court Disposition

Appeal dismissed

Orders

  • The respondents were entitled to refuse the appellant's input tax claims for the periods in question.