Beta This part of GOV.UK is being rebuilt – find out what this means

HMRC internal manual

VAT Fraud

From
HM Revenue & Customs
Updated
, see all updates

What to do if you discover VAT fraud: notifying the taxable person of your decision: decisions made using the Kittel principle

The (This content has been withheld because of exemptions in the Freedom of Information Act 2000) contains wording on the legal basis for the refusal of entitlement to the right to deduct input tax on the grounds that the taxable person ‘knew or should have known’ that he was participating in ‘transactions connected with fraudulent evasion of VAT’ and requires that case specific reasons should be set out.

All such draft letters, along with a completed draft List of Documents (LoD), should be forwarded to the (This content has been withheld because of exemptions in the Freedom of Information Act 2000) via email for comment prior to issue. On receipt back from the VAT Fraud Team the letter should be issued and a copy saved to the taxable person’s EF.

It is important that the letter is issued as soon as possible after receipt of advice from the VAT Fraud Team, but only once the LoD has been completed.

Where the taxable person is a company, and that company has been removed from the Companies House Register, the (This content has been withheld because of exemptions in the Freedom of Information Act 2000) should be completed, except that once reviewed by the VAT Fraud Team and saved to EF it should be sent to the (This content has been withheld because of exemptions in the Freedom of Information Act 2000) dealing with the company’s assets.

Once the letter has been issued a copy should be sent to the (This content has been withheld because of exemptions in the Freedom of Information Act 2000) , located in the Solicitor’s Office, using the email address (This content has been withheld because of exemptions in the Freedom of Information Act 2000) .