Natasha Barnes was instructed in this lead case concerning the lawfulness of the ‘fall back’ provisions, which enable HMRC in certain circumstances to assess a UK trader for acquisition tax on goods which have never physically entered the UK. This was the first time the ‘fall back’ provisions had been fully considered by the UK courts, and a large number of high value appeals were stood behind this appeal.
The Appellant taxpayer, Ampleaward, is a trader of alcohol in duty suspense. It appealed against assessments for unpaid acquisition tax, which were issued on the basis that Ampleaward was liable to account for the acquisition tax in the UK because its UK VAT registration number had been used to zero-rate the supplies. This was despite the fact that the goods had never physically entered the UK.
A preliminary hearing was listed before the FTT to consider inter alia:
(a) whether the ‘fall back’ provision could apply to goods traded in duty suspense.
(b) whether a trader could recover acquisition tax, assessed under the ‘fall back’ provisions as input tax.
The FTT found in respect of HMRC on all issues and a link to the judgment can be found here.