VAT advice service

VAT advice service

One of our VAT specialists was able to offer a VAT advice service resulting in the withdrawal of a VAT assessment.

Background of first issue

In summary, HMRC commented that there was no proof for payment in relation to the purchases of various goods. .  HMRC maintained that there was no evidence of payment in respect of the purchases. HMRC were not satisfied with the paperwork nor the explanations given by our client for the purchase of the goods. Our client had provided invoices and photographs of the goods.  HMRC maintained that this information did do provide any assurance of their purchase by our client

It was eventually accepted by HMRC that our client had provided VAT invoices in relation to the purchases in question.

Background of second issue

Secondly HMRC had disallowed input tax in relation to invoices from our clients Solicitors concerning a legal dispute that our client encountered in relation to access to the land on which various services were provided. HMRC described this as “simply a civil dispute in relation to a rights of way issue….”.

HMRC commented that the claims of input tax in relation to the legal dispute between our client, and third parties did not relate to the course and furtherance of our clients business. HMRCs stated view was that this was simply a civil dispute in relation to a rights of way issue relating to access.

VAT review

Our VAT advice service concluded that the proof that our client had made payment rested in the cash that our client received from income on which output tax has been declared. These cash receipts together with a small amount of our client’s personal savings and loans from friends or family were utilised to purchase the goods in question.

Our specialist VAT advice service concluded that a matter being “simply a civil dispute”, such as taking legal action in relation to a debt, or any other “civil dispute” is not in itself a reason for disallowing input tax. One of our VAT specialists at our VAT consultancy firm commented that there was a clear nexus between our client providing, or seeking to provide, services on the land in question and having a right of way to gain access to the land, being the subject of the legal dispute, on which the services are to be provided.

VAT advice service

Follow the link for details of  some of our VAT advisory services that  we can offer and details of our VAT expertise or call us on 0161 883 2120.

HMRC

HMRCs guidance on VAT Input Tax