The UK’s First Tier Tribunal (“FTT”) has issued its judgement in the case of SAS SVS LA MARTINIQUAISE (TC/2014/06041) (“LAM”) and it’s a reminder for all businesses making European Refund Claims to ensure they are submitted by the statutory deadlines.
LAM submitted 2 claims for repayments of UK VAT, incurred in the calendar year 2012, to HMRC in March 2013. HMRC received these claims but subsequently rejected them, on the basis that LAM should have been registered for UK VAT. On the basis of this correspondence from HMRC, LAM did not submit a third claim for VAT incurred in the year 2012.
Following discussions with its advisor, LAM returned to HMRC asking for its two original claims to be reconsidered on the basis that it had no requirement to be VAT registered. Following discussions between HMRC and LAM, it was agreed that the claims were valid and HMRC arranged for payment of them to be made. Having finally agreed the position with HMRC, LAM subsequently submitted its third claim for the year 2012 in December 2013.
Unfortunately for LAM, this third claim was rejected by HMRC on the basis that it had been received after the statutory deadline of 30 September 2013. Despite LAM appealing to the FTT and the Judges expressing sympathy with its position, it was confirmed that there is no legal basis for claims received after the deadline to be accepted – regardless of the circumstances.
Whilst this is an unfortunate turn of events for LAM, it again brings into sharp focus the need to make sure that statutory deadlines are met. Businesses who think they have a valid claim should always submit it to HMRC and manage any questions about its validity later. If the making of a claim is left to after any issues are resolved, it may be too late.
EU businesses making claims for the calendar year 2015 will need to submit them to HMRC by 30 September 2016. Non-EU businesses need to submit claims for the same time period by 30 June 2016. However, where VAT has been incurred and a claim can be made for it, we always recommend businesses submit the claim as soon as possible – there is no need to wait until 30 September to do that. If you would like to explore doing this for your business, please do not hesitate to contact us.