Michael O'Donnell v Commissioners for Her Majesty's Revenue and Customs
Decision date: 21 May 2010
Neutral citation: [2010] UKFTT 236 (TC)
Overall AI summary confidence: high
Short overview
This short overview is intended to summarise the case, issues and outcome so far as they are supported by the judgment.
AI confidence in this short overview: high
Michael O'Donnell appealed HMRC's partial refusal of a DIY builders VAT refund for his self-built dwelling, challenging disallowance of invoices totalling £24,509.66. The Tribunal found the disputed supplies were zero-rated services (or mixed supplies treated as services under Schedule 8) and therefore no VAT was "chargeable" for the purposes of s.35 refund claims. The appeal was dismissed and HMRC's refusal upheld. The Tribunal noted suppliers who charged VAT in error should correct their invoices.
Ratio decidendi
This summary is intended to identify the ratio decidendi, meaning the legal reasons for deciding and the binding part of the decision.
AI confidence in this ratio decidendi summary: high
Where a supplier's supply consists of services for the construction of a dwellinghouse (including goods incorporated into that work), that supply is zero-rated under s.30 and Schedule 8 and so VAT is not "chargeable" for the purposes of s.35 DIY builder refund claims; mixed supplies of materials and services that are properly treated as supplies of services likewise fall outside entitlement to a refund.
Obiter dicta
This summary is intended to identify obiter dicta, meaning observations made by the way that were not necessary to deciding the case and are not binding.
AI confidence in this obiter dicta summary: medium
The judgment observes that HMRC guidance (Notice 719) explains the distinction between reclaiming VAT on materials incorporated into a new dwelling and the exclusion of construction services from refunds, and that an unrecorded telephone enquiry to a VAT helpline does not suffice to establish that the taxpayer received advice that would alter statutory entitlement.