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HMRC internal manual

VAT Refunds

HM Revenue & Customs
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Unjust enrichment: Some items to consider: Other questions to ask claimants

These include the following

  • If comparisons have been made with other competitors’ products and promotions, they should be asked to specify the businesses whom they believe to be their competitors. If you think it might be useful, you might also carry out some limited research to try to establish whether there are any indications that all parties selling the goods in question are passing on the VAT.
  • How were the details of competitors’ prices and promotions collected?
  • During the period of the claim, were prices altered in response to price changes and promotions by competitors?
  • What were the wholesale prices and retail selling prices of the goods covered by the claim? From this we can discover margins.
  • Where the claimant is involved in interest free credit sales, or where products are strongly marketed by suppliers, it may be worth asking the following questions to establish whether the loss is as large as claimed:
  • How many suppliers did the claimant have during the period of the claim? Did all the products subject to the claim benefit from interest free credit promotions?
  • How were the cost prices for these goods or services negotiated during the period of the claim? Did these negotiations take into account interest free credit promotions or other indirect support from suppliers?
  • Were volume discounts received? Did these differ for interest free credit promotions?
  • Does the claimant have a formal policy on the allocation of selling space for products subject to interest free promotions?