Key points following the decision in Paymex Ltd
Further to our previous blog of 26 August 2011, HMRC has now issued Revenue & Customs Brief 35/11 which offers further clarification on points of interest/concern regarding the VAT Tribunal decision in the case of Paymex Limited. Headline points are as follows:
- Although the Tribunal decision itself applied purely to consumer IVAs, HMRC consider that the terms of the Tribunal decision read across to all IVAs.
- The Tribunal decision does not deal with Company Voluntary Arrangements or Partnership Voluntary Arrangements – reclaims for VAT arising from roles as supervisors of such arrangements will be rejected.
- The effect of the Tribunal ruling is that IPs may have overpaid VAT, and therefore HMRC will pay claims for such overpaid VAT, subject to the normal partial exemption recovery position, where the IP’s services in an IVA are covered by the terms of the ruling. The VAT repaid will go into the IVA.
Sarah Franklin and Steve McIntyre are currently looking at claims and would be pleased to offer further advice should an Insolvency Practitioner be considering submitting a claim for a refund of VAT. They can be contacted on 01962 735350.
Insolvency Practitioner to get over £50,000 VAT Refund
Following the recent issue of Revenue & Customs Brief 27/11 which sets out HMRC’s position regarding the Tribunal decision in Paymex Ltd, we have been approached by several Insolvency Practitioners to look at their supplies in connection with individual voluntary arrangements.
One particular practice is due a refund of over £50,000 in VAT plus interest.
Revenue Customs Brief 27/11 stated that HMRC would not be appealing the decision subject to the normal rules of input tax adjustment capping and unjust enrichment and they will pay claims for overpaid tax charged on the services of Insolvency Practitioners that fall within the findings of the Tribunal decision.
Steve McIntyre our Director of VAT is currently looking at claims and would be pleased to offer further advice should an Insolvency Practitioner wish to submit a claim for refund of VAT.
You can contact Steve on 01962 735350 or by email: steve.mcintyre@thevatconsultancy.com