TC09596 - [2025] UKFTT 00895 (TC)

In order to put the parties’ respective contentions into context, we start with the relevant statutory provisions. The relevant law, so far as is material to the issues in this appeal, is as follows:

The law relating to payment, and recovery, of VAT in the United Kingdom is contained in VATA, which was intended to reflect the provisions of certain EC Directives. The relevant EU legislation is contained in Council Directive 67/227/EEC of 11 April 1967 on the harmonisation of legislation of Member States concerning turnover taxes (“the First Directive”) and Council Directive 77/388/EEC of 17 May 1977 on the harmonisation of the laws of the member states relating to turnover taxes - Common system of value added tax: uniform basis of assessment (“the Sixth Directive”), as amended by Council Directive 95/7/EC of 10 April 1995. The provisions of the Sixth Directive, as amended by the Invoicing Directive, were replaced by EC Council Directive 2006/112/EC, which is known as the Principal VAT Directive (“thePVD”). The current EU provisions relating to VAT and the recovery of input tax are contained in the PVD, which is the source of legislation concerning VAT. The PVD was transposed into domestic law by VATA.