RSK Cars Limited v The Commissioners for HMRC
Decision date: 15 January 2026
Neutral citation: [2026] UKFTT 122 (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
RSK Cars Ltd appealed HMRC assessments of £90,953 plus related careless penalties, arguing it was entitled to account for VAT under the second‑hand motor car margin scheme. The First‑tier Tribunal found RSK had not complied with the statutory record‑keeping and invoice requirements (notably failure to maintain the prescribed stock book and adequate purchase/sales documentation) and so could not use the margin scheme. HMRC's assessments, based on applying the VAT fraction to gross sales and adjusted against declared VAT, were held valid and the appeal was dismissed.
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 treated as determinative that entitlement to the second‑hand car margin scheme requires strict compliance with the specific statutory record‑keeping and invoice requirements (including maintaining the prescribed stock book); where those requirements are not met and margins cannot be verified from records, VAT must be accounted for on the full selling price and assessments under s.73(1) may be validly made to the officer’s best judgment.
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: high
The Tribunal observed that late or belated attempts to reconstruct records do not retrospectively validate use of the margin scheme, emphasised that parties must comply with Tribunal directions, and noted the Tribunal has no jurisdiction to reduce an assessment below zero (refunds require separate error‑correction claims).