Deos Group.co.uk Ltd Wins Appeal Against HMRC on VAT Input Tax Disallowance and Penalty

• The case involved Deos Group.co.uk Ltd appealing against HMRC’s denial of input tax and a penalty assessment.
• The Tribunal was held at Taylor House, London, and the judgment was given on 21 August 2025.
• The core issue was whether Deos knew or should have known about the connection of their purchases with VAT fraud.
• Deos was a small business dealing in office equipment and later in wholesale consumer electronics.
• HMRC disallowed input tax on 18 purchases, claiming they were linked to VAT fraud.
• The Tribunal found that the transactions had a reasonable explanation other than VAT fraud.
• The appeals were allowed, meaning Deos was not found to have known about the fraudulent connection.
• The penalty assessment was contingent on the input tax denial, which was overturned.

Source: bailii.org

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.

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