Zipvit Limited v The Commissioners for HM Revenue and Customs
| Jurisdiction | UK Non-devolved |
| Judge | Mrs Justice Proudman |
| Neutral Citation | [2016] UKUT 0294 (TCC),[2016] UKUT 0294 (TCC) |
| Court | Upper Tribunal (Tax and Chancery Chamber) |
| Subject Matter | Tax,27 June 2016 |
| Date | 27 June 2016 |
| Published date | 22 February 2017 |
[2016] UKUT 0294 (TCC)
Appeal number UT/2014/0041
VALUE ADDED TAX — Is the appellant entitled to recover VAT input tax in respect
of MailmediaR supplies to it from Royal Mail, notwithstanding that Royal Mail did
not in fact pay VAT on those supplies, the parties thought the supplies were exempt
and the supplies were shown as VAT exempt in the invoices? No
UPPER TRIBUNAL
TAX AND CHANCERY CHAMBER
Between:
Appellant
ZIPVIT LIMITED
- and -
THE COMMISSIONERS FOR HER MAJESTY’S
REVENUE AND CUSTOMS Respondents
TRIBUNAL: MRS JUSTICE PROUDMAN DBE
Sitting in public at The Rolls Building, Fetter Lane, London EC4A 1NL on 14, 15 and
16 March 2016
Roger Thomas QC, instructed by Mishcon de Reya LLP solicitors, for the Appellant
Sam Grodzinski QC and Eleni Mitrophanous, instructed by the General Counsel and
Solicitor to HM Revenue and Customs, for the Respondents
© CROWN COPYRIGHT 2016
2
DECISION
1. This is an appeal from the decision of the First-tier Tribunal (“FTT”) (Judge
Barbara Mosedale) released on 3 July 2014. The appellant made a claim on 15
September 2009 under Regulation 29 of the Value Added Tax (“VAT”) Regulations
1995 (1995/2518) (“the Regulations”) for input tax which it claimed to have incurred
in the period 31 March 2006 to 30 June 2009, and it made a further claim on 8 April
2010 for the next two accounting periods. The respondents (“HMRC”) rejected the
claims on 7 May 2010, they upheld the decision in a review letter dated 2 July 2010
(written by a Mrs JC Pledger) and the FTT also rejected the claim in its decision.
2. I have had the advantage of representation by Mr Roger Thomas QC for the
appellant Zipvit Limited and by Mr Sam Grodzinski QC and Ms Eleni Mitrophanous
for HMRC.
3. The appeal is from the FTT’s decision on a preliminary issue, namely,
“Whether a taxable person, who has received supplies of services
which were at the material time treated by Royal Mail as exempt
under Value Added Tax Act 1994, but which were properly
chargeable to VAT under the Sixth VAT Directive or Principle [sic]
VAT Directive, is entitled to an input tax credit in respect of those
supplies.”
Facts
4. The appellant, a company registered for VAT (all its supplies being subject to
VAT), carried on the business of supplying vitamins and minerals by mail order. It
used the services of Royal Mail to send its mail orders and to distribute
advertisements. It used PacketpostTM, MailmediaR and deliveries by Parcelforce.
However it is only the supplies by MailmediaR which are in issue before me as those
supplies are specimen supplies for the purposes of this hearing.
5. Both Royal Mail and HMRC believed that the supplies made by Royal Mail to
the appellant were exempt from VAT and Royal Mail did not therefore issue VAT
invoices (within the meaning of the Regulations - see below) to the appellant. The
contract between the appellant and Royal Mail was silent as to VAT and the invoices
indicated (with an “E”) that the supplies were exempt.
6. The CJEU ruled on 23 April 2009 in the case of R (oao TNT Post UK Limited)
v. HMRC C-357/07; [2009] ECR 1-3025; [2009] STC 1438 that the postal exemption
was limited. The CJEU decided (at [49]) that,
“…the exemption provided for in Article 13A 1.(a) of the Sixth Directive
[replaced by The Council Directive of 28 November 2006 on the common
system of value added tax (2006/112/EC) (the Principal VAT Directive or
“PVD”)] applies to the supply by the public postal services acting as such-
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