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HMRC internal manual

VAT Fraud

HM Revenue & Customs
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Contrivance: The goods and services: Inspections

Aspects to consider include:

  • Does the taxable person receive the goods themselves?
  • What is the taxable person’s receipt and delivery process?
  • What level of detail did the inspection report contain and was it enough to satisfy a reasonable businessman?
  • If there were any unusual findings (such as HMRC date stamps / customs stamps having been removed, damaged packaging etc) what action did the taxable person take?
  • Did the taxable person pay for inspections but there is no evidence that they were carried out?
  • Alternatively, are there inspection reports but no record of them having been paid for?
  • Could the goods have been inspected to the level suggested on the reports in the time between the taxable person obtaining them and the time they were removed from the freight forwarder / warehouse?
  • When exactly was the inspection undertaken?
  • When was any inspection report actually received by the taxable person? (fax transmission times might be important)
  • Were there inconsistencies between the quantity of goods held and the quantity purchased/sold?

The above list is not exhaustive.