FTT Partially Allows VAT Fraud Appeals: Director’s Unsophistication Mitigates Penalties in AAMRL Case

The FTT partially allowed appeals by AAMRL Ltd and its director against HMRC decisions related to missing trader VAT fraud.
HMRC had denied input VAT (Kittel principle), deregistered the company (Ablessio principle), and imposed penalties on both the company and its director.
The FTT found the transactions were fraudulent and commercially senseless, but concluded the director, Ms Loria, was unsophisticated and not the guiding force behind the fraud.
The FTT ruled that HMRC failed to prove Ms Loria knew or should have known about the VAT fraud, so the Kittel test was not met in her case.

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.