VRM15000 - Appeals against refusal of a claim

Right of appeal

A refusal to pay a claim under section 80 of the VAT Act 1994 is subject to a right of appeal provided by section 83(t) of the Act.

A refusal to pay a late claim for input tax under regulation 29 of the VAT Regulations 1995 is subject to a right of appeal provided by section 83(c) of the VAT Act 1994.

Section 83(1)(t) of the VAT Act 1994 gives a right of appeal against any decision we make in relation to a claim brought under section 80 of the VAT Act 1994 including, for example, decisions to reject claims, for whatever reason and to make recovery assessments under section 83(4A). An appeal under this subsection will also, almost certainly, fall within section 83(1)(b).

Section 83(c) of the VAT Act 1994 gives a right of appeal against the same decisions in relation to a late claim for input tax under Regulation 29 of the VAT Regulations 1995.

For further guidance on appeals see the Appeals Reviews and Tribunals Guidance.

It is important to remember that if the appeal is against a liability ruling (under section 83(1)(b)) where no claim has been made, a tribunal finding in the appellant’s favour doesn’t entitle him to any payment. The appeal was concerned simply with the question of whether the supplies in question ought to have borne VAT. Any claim made in the wake of such a decision will, of course, be limited to four years.

Appeals by customers

The customer of a person who has made a claim under section 80 for amounts said to have been wrongly accounted for as VAT on supplies made to that customer is entitled to bring a claim under section 83(1)(b).

For example, Jack makes a claim under section 80 for VAT that he considers was wrongly accounted for on supplies of pails to Jill and that claim is refused. Both Jack and Jill have a right of appeal against that decision.

However, if Jill appeals, and Jack doesn’t, and her appeal is successful, that does not entitle either of them to payment of Jack’s claim.

A customer is also entitled to appeal against a liability ruling against his supplier – See Williams & Glynns Bank Ltd [1974] VATTR 262.

Appeals by VAT groups

Any appeal by a VAT group must be made by the company acting as the representative member at the time when the appeal is made.

Appeals – Holding claims on file – Protective claims

We do not accept protective claims. We do not hold claims on file pending the determination of litigation.

If a claim is made at a time when there is a binding judgment (Upper Tribunal or High Court or above) against us, we should pay it and make a protective recovery assessment, see VRM10000, and the claimant can then appeal against that assessment.

If a person makes a claim where we don’t believe that any claim arises, the claim should be rejected and the claimant invited to appeal.