VATF62500 - Contrivance: The way the taxable person trades: Turnover and growth
The rate and level of increase in a taxable person’s turnover may be an indicator that this growth is not down to normal commercial factors (VATF32000) but linked to involvement in VAT fraud.
Aspects to consider include:
- Has there been significant investment? (VATF62600)
- Has there been a supply of an innovative product or service, supported by significant advertising and promotion? (VATF62700)
- Has the taxable person the staff / resources / expertise?
- Has the annual net turnover from either the VAT returns and/or annual accounts shown an exceptional short-term turnover growth, not supported by any apparent justification such as previous involvement in the industry etc?
- What capital or assets did the taxable person have when he entered into the transactions?
The above list is not exhaustive.