In the Scottish case of HMRC v Simpson & Marwick (CS – 12 April) a firm of solicitors which provided legal services in respect of insurance claims claimed bad debt relief in respect of the full amounts which insurance companies had declined to pay. HMRC issued an assessment on the basis that relief was only available for the VAT fraction of the debt as in AW Mawer & Co v C & E Commrs [1986] VATTR 87. The Court of Session (CS) unanimously upheld the assessment (reversing the Upper Tribunal decision and restoring the First-tier decision). The CS held that ‘the proper construction of (VATA 1994 s 36) is the construction for which HMRC contend. The refund to which the taxpayer is entitled is stipulated in s 36(2) as the "amount of VAT chargeable by reference to the outstanding amount"....
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In the Scottish case of HMRC v Simpson & Marwick (CS – 12 April) a firm of solicitors which provided legal services in respect of insurance claims claimed bad debt relief in respect of the full amounts which insurance companies had declined to pay. HMRC issued an assessment on the basis that relief was only available for the VAT fraction of the debt as in AW Mawer & Co v C & E Commrs [1986] VATTR 87. The Court of Session (CS) unanimously upheld the assessment (reversing the Upper Tribunal decision and restoring the First-tier decision). The CS held that ‘the proper construction of (VATA 1994 s 36) is the construction for which HMRC contend. The refund to which the taxpayer is entitled is stipulated in s 36(2) as the "amount of VAT chargeable by reference to the outstanding amount"....
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.jpg?sfvrsn=335a554c_0 "300 x 250 (MPU)")