HMRC now owes Bond House £13.2 million VAT reimbursement
Bond House, which challenged the legailty of the UK’s Revenue authority in withholding VAT reimbursements, has been awarded a £13.2 million settlement in the European Court of Justice.
Bond House and their advising VAT consultants Bentley Jennison were waiting for the European Court of Justice (ECJ) ruling to determine whether or not the methods of VAT collection employed by HM Revenue and Customs are illegal and contrary to EU VAT Law. The decision was announced in Luxembourg today. HMRC was found to have acted unlawfully, and it is estimated the decision will cost the Treasury hundreds of millions of pounds as other companies make their claims.
David Sweeting, Head of VAT Consultancy at accountancy firm Bentley Jennison commented: “To combat a fraud which has been estimated at costing the British taxpayer between £1.1 billion and £1.9 billion, HMRC took a cruel and punishing stance for innocent business people. Their view that no VAT rebates should be paid to any company innocent or otherwise, that is part of a chain of supply involving a missing trader or hijacked VAT number, simply penalises innocent traders for the actions of criminals and for the failure of Customs to identify the fraudsters.”
Ian Prescott, founding partner and director of Bond House Systems based in Castleford, West Yorkshire, said; “For the past three years we have been forced to cease trading after the withdrawal of a VAT refund of £13.2m. We had to make 20 people redundant, myself and the other business directors and their families have suffered terribly as a result of the Customs actions. It has been a long and painful battle which the team has most ably and effectively fought and we are satisfied with the outcome, although Customs should never have been able to act in this way.”
For details of the case background see the story at www.mobileeurope.co.uk/1765.