Exmoor Coast Boat Cruises Ltd
| Jurisdiction | UK Non-devolved |
| Judgment Date | 17 December 2014 |
| Date | 17 December 2014 |
| Court | First-tier Tribunal (Tax Chamber) |
Judge Barbara Mosedale
Mr M Oxenham, Director, appeared for the Appellant
Mr J Wibberley, Counsel, instructed by the General Counsel and Solicitor to HM Revenue and Customs, appeared for the Respondents
Value added tax – Online filing – Whether breach of right to manifest religion – On facts no – Application of Value Added Tax Regulations 1995 (SI 1995/2518), reg. 25A – Appeal dismissed as appellant did not qualify for relief.
[1] The appellant appeals against decisions of HMRC refusing its application to file its VAT returns on paper. It was represented by its sole director and shareholder, Mr Oxenham.
[2] The original HMRC decision was contained in a letter dated 15 May 2012. The appellant asked for a review of this decision; HMRC then issued a further decision (rather than a review of the original decision) dated 12 October 2012 which gave the appellant the option of appealing or asking for a review. This happened again on 24 October 2012.
[3] HMRC then issued a further decision dated 31 October. Again this decision was not described as a review decision but this time it did not offer the appellant the option of a review but merely stated it had 30 days to appeal. This might indicate that HMRC intended this decision to be the review decision but it was rather short and seemed to be intended to deal with a specific issue raised by Mr Oxenham (the meaning of “incompatible”) rather than containing HMRC's conclusions and reasoning as required by s 83F(6) Value Added Tax Act 1994 (“VATA”).
[4] There were further detailed letters from HMRC to the appellant reiterating the decision but dealing with various concerns on the subject raised by Mr Oxenham. None of these further letters described themselves as “review” decisions nor did they give the appellant 30 days to appeal from the date they were issued.
[5] The appellant eventually lodged an appeal on 1 February 2013.
[6] Was this appeal late? The only contender as the “review” decision was HMRC's letter of 31 October 2012 and if it was a review decision, then the appeal was lodged late. If it was not a review decision, then the appeal was not lodged late. This is because the appellant had requested a review and was (under s 83G(5) VATA) entitled to appeal at any time from 45 days after the review was requested until 30 days after the receipt of the conclusion letter under s 83F(9) VATA. None of the letters describes itself as a conclusion letter.
[7] It does not matter. If the appeal was late, HMRC indicated that they had no objection to its lateness. I would admit the appeal because, even if technically late, HMRC had not made it clear to the appellant that the 31 October letter was the review letter from which 30 day period ran; the previous correspondence would reasonably have led a person to believe he would be given a new 30 day period each time HMRC replied to a letter he wrote. So either the appeal was not late, or I have admitted it out of time. I go on to consider the appeal.
[8] Compulsory VAT online filing was introduced for all businesses with a turnover of over £100,000, and any newly registered business, with effect from 1 April 2010 and for all businesses with effect from 1 April 2012. HMRC refers to businesses liable to registered for online filing from 1 April 2010 as “first tranche” and those only required to be registered from 1 April 2012 as “second tranche”.
[9] The appellant in this case was in the second tranche. Its turnover was below the VAT registration threshold and its registration was voluntary. The appellant applied to be exempt from online filing on religious grounds. By various letters dating back to 15 May 2012, as mentioned above, the appellant's claim for exemption from online filing on religious grounds was refused by HMRC. The main reason given was that HMRC were not satisfied that the appellant did not and would not use a computer and he had not demonstrated that he was a member of a religious society whose beliefs were incompatible with the use of a computer.
[10] Mr Matthew Oxenham is the sole director and shareholder of the appellant. The appellant, being owned and controlled by him, is in effect his alter ego. The appellant's business is running boat cruises (sight-seeing and fishing) out of Lynmouth harbour.
[11] An agent completes its PAYE returns online; an accountant submits its corporation tax returns online. Mr Oxenham personally completes the VAT return and wishes to continue submitting it by paper.
[12] Mr Oxenham has interests in other businesses. He owns holiday cottages. Glen Lyn Generations Ltd (“Glen Lyn”) is owned by him and his parents, although he is the major shareholder. All three of them are its directors. The company operates a small hydro electric plant. That business is also VAT registered. It was in “tranche 1” due to its turnover. By letter dated 16 July 2010, Mr M Oxenham requested exemption from online filing, which was refused.
[13] Since then, Glen Lyn's VAT returns have been submitted electronically by an agent appointed by the company. Its corporation tax return is submitted online by an accountant.
[14] The Tribunal had in front of it as evidence the many letters passing between Mr Oxenham and HMRC; it also heard oral evidence from Mr Oxenham.
[15] HMRC also produced notes of very long phone conversations between Mr Oxenham and various HMRC officers. Mr Oxenham accepted these phone calls took place but challenged (in advance of the hearing) the accuracy of the officers' notes about them. HMRC was unable to obtain the recordings of the phone conversations; nor did HMRC produce as witnesses the officers who had spoken to Mr Oxenham on the phone.
[16] In assessing the reliability of the notes I took into account that they appear to be a contemporaneous record and the only one which I have of what was said. On the other hand, Mr Oxenham attended to give oral evidence and challenged the accuracy of parts of the notes, whereas the officers who took the notes did not attend so I was unable to judge how reliable their notes might be. However, I also took into account that, overall, the notes were credible in that they gave an impression of Mr Oxenham very similar to the impression I gained of him having heard him in Tribunal. For instance, as in Tribunal, they showed he was happy to discuss his beliefs on climate change at length but his claim to be a member of a religious group was not given with any details that made it credible.
[17] To a large extent the credibility of the notes did not matter; but there were some things in the notes which Mr Oxenham considered inaccurate. The most glaring was whether Mr Oxenham had actually said in one of the phone calls, as the note recorded, that he belonged to several religions but “the main one would be paganism”. He denied he said this but he did accept that paganism had been discussed in the phone call and that he had said that he studied many religions and that he found paganism interesting.
[18] While for the reasons explained below and briefly mentioned above, I had real doubt over Mr Oxenham's claim that he was a member of the Jimite sect of the Plymouth Brethren. Nevertheless, as I only had his live evidence of what was said in these phone calls, I accepted that he had not actually claimed to be a pagan but merely said that he was interested in paganism. The notetaker likely misunderstood him. Nevertheless, I do consider that the notes overall give a relatively accurate impression of the discussions between Mr Oxenham and the HMRC officers concerned.
[19] I agree with Mr Wibberly that, on the basis of the telephone notes, it was clear that Mr Oxenham put his scientific beliefs to the forefront and (at least at first) was sounding out how he could obtain the religious exemption but without stating that he was a member of any particular religion nor couching his beliefs in terms of religion.
[20] I agree with Mr Wibberley that Mr Oxenham clearly saw himself on something of a crusade against the requirement to file online. He considered the law unfair; he did not see why exemption had to be restricted to members of a religious group; he did not see why exemption had to be restricted to religious beliefs; he considered online filing was made compulsory merely to justify the cost of the online filing system; if he won his case he intended to apply for exemption for Glen Lyn Generations Ltd and clearly hoped to persuade other persons to pursue exemption. He believed that refusing to file online was taking a stand against human behaviour inducing climate change.
[21] Mr Oxenham did not refer to the Jimites until some way into his extended correspondence with HMRC, and then he only claimed to be “affiliated” to them. In the hearing Mr Oxenham appeared reluctant to claim that he was a practising member of the Plymouth Brethren, saying that they were a “disparate” group and there was “no test” to be a member. He also implied he was not a practicing member by saying he practiced his religion alone and did not accept he needed to be a member of a religious group to benefit from exemption. In cross examination, he disagreed with the statement that he was not a member of a religious group, and later on claimed that he was one of the Brethren.
[22] I accept that as a child he attended Sunday School at the Plymouth Brethren Chapel near his home. The Chapel near his home has long since ceased to be a meeting place for the Brethren, although occasionally members come to see it and Mr Oxenham may speak with them. Mr Oxenham did not claim to attend any Brethren meetings.
[23] He said he sympathised with the views of the Jimites, which on his evidence were a sect of the Plymouth Brethren which rejected electronic communications. However, I noted that while he had explained to me why he,...
To continue reading
Request your trial
-
Glen Lyn Generations Ltd; Exmoor Coast Boat Cruises Ltd
...their VAT returns online, as they did not qualify for exemption from online filing. This case follows Exmoor Coast Boat Cruises Ltd TAX[2015] TC 04191, where the company (the second Appellant in this case) unsuccessfully relied on religious grounds. Mr Oxenham, the sole active director of b......
-
Harvey (t/a Sun Ice Air Conditioning Services)
...beliefs that are those of a “religious society or order”.[33] However, this Tribunal agrees with Judge Mosedale when she states in [2015] TC 04191“A Tribunal is very reluctant to assess the quality of a persons moral or religious beliefs. Nevertheless, it has to be the case that the law can......