VAT: validity of default surcharge when HMRC is holding monies paid by mistake
In Graffiti Busters Ltd v HMRC (TC03201 – 10 January 2014) Graffiti Busters (GB) had been imposed a default surcharge for late payment of VAT. GB had also paid HMRC in error under the CIS and these monies had not been refunded.
Interestingly GB did not make a claim for restitution nor did it claim the equitable right of set-off. Instead it simply argued that the fact that HMRC held an equivalent amount of money without any statutory basis constituted a reasonable excuse for the late payment of VAT.
The tribunal agreed with the company and found that it had a reasonable excuse in relation to the monies already held by HMRC.
GB also contended that it fell within the Steptoe exception ([1992] STC 757). The case is authority for the proposition...
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VAT: validity of default surcharge when HMRC is holding monies paid by mistake
In Graffiti Busters Ltd v HMRC (TC03201 – 10 January 2014) Graffiti Busters (GB) had been imposed a default surcharge for late payment of VAT. GB had also paid HMRC in error under the CIS and these monies had not been refunded.
Interestingly GB did not make a claim for restitution nor did it claim the equitable right of set-off. Instead it simply argued that the fact that HMRC held an equivalent amount of money without any statutory basis constituted a reasonable excuse for the late payment of VAT.
The tribunal agreed with the company and found that it had a reasonable excuse in relation to the monies already held by HMRC.
GB also contended that it fell within the Steptoe exception ([1992] STC 757). The case is authority for the proposition...
If you or your firm subscribes to Taxjournal.com, please click the login box below:
If you do not subscribe but are a registered user, please enter your details in the following boxes:
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