DJJ Services Ltd: Kittel Principle, De-registration, and Penalty

DJJ Services Ltd appealed HMRC decisions to deny input VAT recovery, de-register the business, and impose a penalty.
DJJ argued that HMRC did not demonstrate it knew or should have known its purchases were connected to fraudulent VAT evasion.
The FTT dismissed the appeal, finding that DJJ knew or should have known its transactions were connected to fraud.
The FTT considered factors such as DJJ’s suppliers, Mr. Laxman’s lack of experience, DJJ’s awareness of fraud, and lack of due diligence.
The FTT also found that DJJ facilitated the VAT fraud of another, supporting the de-registration decision.
The appeal was partially successful as some assessments were made out of time.

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.