Tribunal Overturns VAT Penalties Due to Obscure Rule Change and Reasonable Taxpayer Ignorance

• Mr and Mrs Julian appealed against £43,438 in VAT penalties due to unawareness of new AFRS turnover rules.
• The changes, affecting few farmers, were obscurely published and not widely publicized.
• Their accountant, despite being diligent, only discovered the rule change by chance in 2023.
• The Tribunal found their ignorance was a “reasonable excuse” and they acted promptly once aware.
• The appeal was allowed, with the Tribunal rejecting HMRC’s strict stance on ignorance of the law.

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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