20596

THREE-YEAR CAP – repayment requested more than three years after the end of the period in which the last assessment was made – whether capped – yes – appeal dismissed

LONDON TRIBUNAL CENTRE

	INSTAMECH LIMITED	Appellant

	- and -

	THE COMMISSIONERS FOR HER MAJESTY’S
	REVENUE AND CUSTOMS	Respondents

			Tribunal:	DR JOHN F AVERY JONES CBE (Chairman)

Sitting in public in London on 27 February 2008

The Appellant was not represented

Richard Smith, counsel, instructed by the General Counsel and Solicitor to HM Revenue and Customs, for the Respondents

© CROWN COPYRIGHT 2008

DECISION

1.	Instamech Limited appeals against the refusal by the Respondents (“Customs”) to repay amounts of VAT paid by the Appellant on central assessments made in the absence of returns on the ground that the return was submitted later than three years after the end of the accounting period in which the assessment was made.  The Appellant was not represented, and Mr Richard Smith appeared for Customs.  I agreed to hear the appeal in the Appellant’s absence.
2.	I find the following facts:
(1)	Central assessments were made in respect of the following periods on the following dates
Period	Date of assessment	
07/01	14 September 2001	
01/03	14 March 2003	
04/03	13 June 2003	
07/03	12 September 2003	
10/03	12 December 2003	
(2)	On 3 February 2007 the Appellant made returns for the above periods showing that no tax was due, which Customs accept is correct.
3.	Section 80 of the VAT Act 1994 provides:
“(1A) Where the Commissioners—
(a)     have assessed a person to VAT for a prescribed accounting period (whenever ended), and
(b)     in doing so, have brought into account as output tax an amount that was not output tax due,
they shall be liable to credit the person with that amount.
…
(4) The Commissioners shall not be liable on a claim under this section—
(a)     to credit an amount to a person under subsection (1) or (1A) above, or
(b)     …,
if the claim is made more than 3 years after the relevant date.
…
(4ZA) The relevant date is—
…
(c)     in the case of a claim by virtue of subsection (1A) above in respect of an assessment issued on the basis of an erroneous voluntary disclosure, the end of the prescribed accounting period in which the disclosure was made;
(d)     in the case of a claim by virtue of subsection (1A) above in any other case, the end of the prescribed accounting period in which the assessment was made;…”
4.	The Appellant contends in the notice of appeal: “I do not understand how s 80(4) VAT Act 1994 can be used when I am not after a refund but repayment of something that should not have been paid in the first place.”
5.	Mr Smith contends that the legislation is clear.  The last assessment was issued on 12 December 2003 which is in the period ending 31 January 2004.  The relevant date is therefore 31 January 2007.  The claim was made after that, on 3 February 2007.  The Appellant’s position is unarguable.  This is not affected by Fleming v Customs and Excise Commissioners [2008] UKHL 2 since the right to the repayment arose after the legislation imposing the three-year cap.
6.	I agree with Mr Smith for the reasons he gives.  The answer to the Appellant’s contention is that the legislation specifically applies where Customs “have brought into account as output tax an amount that was not output tax due.”
7.	Accordingly I dismiss the appeal.   Customs did not ask for costs.

JOHN F AVERY JONES

CHAIRMAN
RELEASE DATE: 3 March 2008

LON/07/1135