United Kingdom VAT & Duties Tribunals Decisions

The Lime Tree v Customs and Excise [2005] UKVAT V19040 (11 April 2005)

19040

LONDON TRIBUNAL CENTRE Reference No: LON/2003/200

Copy sent to:

Appellant/Applicant

Respondents

THE LIME TREE Appellant

- and -

THE COMMISSIONERS OF CUSTOMS AND EXCISE Respondents

Tribunal: MICHAEL TILDESLEY (Chairman)

CHRIS PERRY C.ENG MICE

Sitting in public in Plymouth on 25 February 2005

DIRECTION

THIS APPEAL against a decision of the Respondents with respect to a Default Surcharge being a reasonable excuse appeal as defined by rule 2 of the Value Added Tax Tribunals Rules 1986 as amended coming on for hearing this day

AND UPON HEARING Phillip Webb, Advocate for Customs and Excise, for the Respondents. No appearance from the Appellant

AND THIS TRIBUNAL having heard this appeal under Rule 26(2) and having announced its decision the Appellant may apply for the decision to be set aside under Rule 26 provided application is made in writing within 14 days of the date of release of the decision

AND THE parties present at the hearing by their said representative stating pursuant to Rule 30(8) of the Value Added Tax Tribunals Rules 1986 as amended that they do not require the said decision to be recorded in a written document in accordance with Rule 30(1) of the said Rules

THIS TRIBUNAL FINDS THAT the Appellant has failed to prove on the balance of probabilities that there was a reasonable excuse for not submitting the VAT returns and payments on time for the periods 10/01, 01/02, 07/02, 10/02

AND THIS TRIBUNAL DIRECTS THAT this appeal is DISMISSED

AND that there is no direction as to costs

REASONS FOR THE DECISION:

The Appellant submitted that his business experienced cashflow difficulties in 2001 because of staff fraud and inaccurate stock takes performed by an incompetent stock taker.

We are not satisfied on the balance of probabilities that the Appellant's submission amounts to a reasonable excuse for the periods 10/01, 01/02, 07/02, and 10/02 because.

(a) The Appellant produced no convincing evidence of the "cashflow" difficulties, such as an accountant's letter.

(b) The Appellant produced no evidence to corroborate the staff fraud, such as a police crime number.

(c) The VAT returns for the periods in question showed that cash receipts exceeded purchases by a substantial margin. Further the Appellant paid the 4/02 return on time, which contradicts the Appellant's assertion that they were experiencing cashflow difficulties.

(d) The Appellant's letter of 22 April 2002 indicated that he had put a stop to the stock loss problems, so that the cause of the cashflow difficulties were no longer relevant for the periods 07/02 and 10/02.

(e) Insufficiency of cash, cannot in itself, amount to reasonable excuse.

MICHAEL TILDESLEY

Chairman

Release Date: 11 April 2005