In Impact Contracting Solutions Limited v HMRC [2023] UKUT 215 (TCC) (1 September 2023) the Upper Tribunal (UT) held that HMRC was entitled to cancel the VAT registration of the appellant regardless of the level of its taxable turnover. The UT decided that the principle of EU law preventing the abuse of the VAT system meant that HMRC could cancel the VAT registration.
The HMRC decision to cancel the VAT registration was made before 1 January 2021 and relied on the principle in the CJEU judgment in Valsts ienemumu dienests v Ablessio SIA (Case C-527/11) (Ablessio). HMRC’s concern appears to have been that the VAT registration number prior to it being cancelled may have been used to facilitate VAT fraud carried out by other persons. It was not in dispute that the appellant had been making taxable supplies that were not connected with VAT fraud at a...
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