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HMRC internal manual

VAT Assessments and Error Correction

HM Revenue & Customs
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Power of assessment: Best judgement: Convincing a tribunal

The importance of being able to convince a tribunal that an assessment has been made to best judgement is paramount. On appeal, the onus is on the business to disprove the assessment

Sometimes, a tribunal may substitute its own judgement for an officer’s in respect of the amount of the assessment but this does not mean that the officer’s judgement was defective, nor that the assessment failed the best judgement test.

In the case of M & A Georgiou t/a Mario’s Chippery, Manchester tribunal and QB October 1995 [1995] STC 1101 the business contended that an assessment raised was not to best judgement.

The tribunal reviewed the evidence in detail and upheld the validity of the assessment but directed that the amount of the assessment should be reduced.

The business appealed to the High Court who upheld the tribunal decision, as it was not the function of the VAT tribunal to engage in a process that looks afresh at the totality of the evidential material before it.

On the evidence, the tribunal had been entitled to find that the assessment had been made to best judgement, even though the amount of the assessment had been reduced.