UPDATE: THE FTT HAS AWARDED COSTS AGAINST HMRC IN RESPECT OF THIS CASE – SEE THE CLARITAX NEWS STORY.
In the case of Athena Luxe Ltd v HMRC [2025] UKFTT 1507 (TC), the FTT has allowed the company’s appeal against HMRC’s decision to deny input VAT recovery in respect of a number of disputed invoices.
VAT – Input tax – Whether Respondents were correct to deny Appellant’s claims for input tax credit – Appeal allowed
The company bought luxury goods to order for onward export to its clientele. HMRC sought to deny input VAT recovery on purchase invoices arguing that they were not valid and it was reasonable for HMRC to refuse to exercise their discretion under The VAT Regulations 1995, reg. 29 to accept the alternative evidence supplied.
However, the FTT did not agree. In respect of the Harrods invoices it judged that:
“as a matter of judicial comity (ie although not binding, the Tribunal would follow and apply a previous decision of the Tribunal in a similar case unless it considered the previous decision to be clearly wrong), applying Fount Construction (which we consider was correctly decided) to the present case we find that the Harrods invoice, when considered together with the corresponding till receipt, is a valid invoice that satisfies the requirement of regulation 14(1)(g). This is because, as we have noted at paragraph 8, above, it provides a description sufficient to identify the goods or services supplied.”
With regards to the Louis Viutton UK Ltd invoices, the FTT agreed that they were not valid but decided that HMRC’s decision not to exercise its discretion to allow alternative evidence was flawed for a number of reasons and that “having come to a conclusion that the decision was flawed, ie was unreasonable, we do not consider that HMRC’s decision would have inevitably been the same but for the flaw(s).”
https://caselaw.nationalarchives.gov.uk/ukftt/tc/2025/1507
Related content from Claritax Books
Value Added Tax, written by Ciaran McGee MA (Oxon), FCA, CTA, is an extensive volume (over 1,000 pages), written primarily for non-VAT specialist accountants and tax advisers.
