KSM Henryk Zeman SP Z.o.o. v The Commissioners for HM Revenue and Customs [2021] UKUT 0182 (TCC)
| Jurisdiction | UK Non-devolved |
| Judge | August |
| Neutral Citation | [2021] UKUT 0182 (TCC) |
| Subject Matter | 4 August 2021 |
| Court | Upper Tribunal (Tax and Chancery Chamber) |
| Published date | 10 August 2021 |
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Appeal number: UT/2019/0075
VAT – appeal under s83(1)(p) against assessment. Whether taxpayer had
legitimate expectation that it was not liable to VAT, whether FTT had
jurisdiction to consider issue of legitimate expectation on such an appeal.
UPPER TRIBUNAL
TAX AND CHANCERY CHAMBER
KSM HENRYK ZEMAN SP Z.o.o.
Appellant
- and -
THE COMMISSIONERS FOR HER MAJESTY’S
Respondents
REVENUE & CUSTOMS
TRIBUNAL:
MR JUSTICE ADAM JOHNSON
JUDGE CHARLES HELLIER
Sitting in public by Microsoft Teams on 15 March 2021
Adrian Eissa QC instructed by Saunders Solicitors Ltd for the Appellant
Natasha Barnes, instructed by the General Counsel and Solicitor to HM Revenue
and Customs, for the Respondents
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DECISION
Introduction
1. KSM Henryk Zeman Sp Z.o.o. (“KSM”) appealed to the First-tier Tribunal (the
“FTT”) against an assessment to VAT on the grounds that it had a legitimate
expectation that it would not be assessed to VAT on certain supplies. It said that its
legitimate expectation arose from statements made by HMRC.
2. The FTT dismissed its appeal, finding that KSM could not rely on the principle of
legitimate expectation because it had not acted reasonably in relying on HMRC’s
statements.
3. KSM sought permission to appeal to the Upper Tribunal. Such permission was
given by the Upper Tribunal after a hearing, but only after raising the question as to
whether the FTT had jurisdiction to consider the question of legitimate expectation in
an appeal against an assessment to VAT.
4. No issue arose in the FTT, or before us, in relation to the amounts involved.
5. Two issues therefore arise in this appeal:
(1) Whether, on the assumption that the FTT has jurisdiction to deal with
legitimate expectation, it erred in concluding that KSM did not have a
legitimate expectation on which it could rely, and
(2) Whether the FTT has jurisdiction to consider the public law issue of
legitimate expectation in an appeal against a VAT assessment.
Background facts
6. There was no issue as to the facts. The tribunal’s findings are set out clearly in
paras [2] to [22] of its decision. In summary:
(1) KSM belonged in Poland for VAT purposes. It entered into a contract
with Energoinstal SA, another company based in Poland to install a boiler
in the UK. Energoinstal was not registered for VAT in the UK.
(2) KSM considered that it should register for VAT in the UK. It applied
to register for VAT. HMRC sent it a questionnaire. There were two
questions which the FTT described as “central to this appeal”:
“(4)Do you supply any of these services to business customers who
belong in the UK?”
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