- The FTT considered appeals against HMRC’s application of the Kittel and Ablessio principles in VAT fraud cases.
- The Kittel principle allows tax authorities to deny input tax deductions if there is fraudulent VAT evasion, the purchases are connected to it, and the taxpayer knew or should have known about the connection.
- DJJ Services Ltd accepted its purchases were connected to VAT fraud but argued it did not know about the connection.
- The FTT dismissed DJJ’s appeal, finding DJJ knew the transactions were connected to fraud based on several factors.
- The Ablessio principle allows deregistration for VAT if a person facilitates VAT fraud knowingly.
- HMRC deregistered DJJ for VAT under the Ablessio principle, and the FTT dismissed DJJ’s appeal, finding it facilitated VAT fraud.
- The decision clarifies factors considered by the FTT in determining taxpayer knowledge of VAT fraud connections.
Source: rpclegal.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
