ENFORCEMENT - 30.11.2011

How to challenge the VATman

First off…

Following changes to the tribunal service on April 1 2009, the VAT & Duties Tribunal was abolished along with the Commissioners and Special Commissioners and amalgamated into the Tax Chamber of the Tribunal Service. Since then costs are not generally available, even if you’re successful. Asking for a reconsideration, now called an internal review, is therefore the first step in challenging an assessment or decision.

Reconsideration?

The VATman says that when you receive an assessment or decision, the letter from the officer should give details of where to send a request for an internal review. In practice, it only tells you that you can ask for an internal review which should be made within 30 days. You then have to write to the original officer, stating in bold letters that it’s a “request for an independent internal review”. If you don’t make this crystal clear, the officer who made the original decision will review it and find in his own favour!

Independence

Once the independent reviewing officer takes over the case he will indicate a timescale for reaching a decision. This is supposed to be within 45 days but in some cases he may refer it to a policy branch for an opinion which will take longer. If the reviewing officer finds in your favour then job done. If the VATman upholds the original decision then you have a further 30 days to appeal to the Tax Chamber of the Tribunal Service.

Appeal

To make an appeal you have to complete a form TS-TaxAp1 (06.10) and include the following copies:

1. The VATman’s decision.
2. Any statement of reasons for that decision.
3. Any notice of conclusions of a review.
4. Any hardship decision.

Tip. You can ask the VATman or the tribunal for “hardship”. This means you don’t need to pay the assessment before the decision if you can show that doing so would cause financial hardship.

Timeline

Some appeals can be dealt with by paper submission rather than appearing in person, which can reduce costs, but it’s only suitable in less complex cases. It normally takes nine to twelve months for a case to come before the tribunal and a further four to six weeks to be notified of the decision.

The risk business

If you disagree with the VATman, it’s worth asking for an internal review. The costs are less than an appeal and you may get a reasonable officer who is genuinely independent. A tribunal appeal is more problematic. The tribunal is independent and if you have a good case you’ll normally win. However, if you have professional representation the costs of the appeal can be greater than the assessment so for anything under £4,000 it’s not advisable, however aggrieved you may feel.