Purever UK Limited v The Commissioners for HMRC
Decision date: 27 February 2025
Neutral citation: [2025] UKFTT 273 (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
Purever UK Ltd appealed default VAT surcharges totalling £232,988 for eight quarterly periods (03/21–12/22), blaming failures by its financial controller. The Tribunal found the surcharge notices valid, held the controller was an "other person" under s71(1)(b) VATA so the company could not rely on his dilatoriness as a reasonable excuse, found the company’s internal controls objectively inadequate, and dismissed the appeal with surcharges upheld.
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
The Tribunal decided that “any other person” in s71(1)(b) VATA includes a trusted, embedded employee (here, the financial controller), so a taxpayer cannot rely on that person’s dilatoriness or inaccuracy as a reasonable excuse. The reasonable-excuse enquiry is objective — measured against what a responsible taxpayer with the appellant’s attributes would reasonably have done — and the default-surcharge regime is not disproportionate in principle; it is only set aside if its application to a taxpayer is plainly unfair or without reasonable foundation.
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 suggested (obiter) that employee dishonesty could, in principle, amount to a reasonable excuse only if there is a causal connection between the dishonesty and the default; absent such causation, allowing the defence would risk widespread avoidance. The Tribunal also commented on expected practical supervisory measures (e.g. probationary monitoring and periodic audits) where large VAT sums are involved.