Golf Holidays Worldwide Ltd – FTT – TOMS – wholesale supplies – rejected claim based on supplies being outside the scheme – taxpayer loss

• Golf Holidays Worldwide Ltd operates the Tour Operator Margin Scheme (TOMS) and included wholesale supplies within TOMS.
• The company submitted a claim on the basis that those wholesale supplies should not have been within the scheme.
• HMRC rejected the claim, stating that no error had been made on the returns when TOMS accounting was adopted for wholesale supplies.
• Golf appealed, arguing that UK law excludes wholesale supplies from TOMS and requires a taxable person to apply the normal VAT rules.
• The FTT agreed with HMRC, stating that Golf had used a lawful option in accounting for VAT which they now realise was less advantageous than an alternative lawful option.
• Golf also argued that HMRC could not rely on the principle of direct effect.

Source KPMG