Ican Finance v Commissioners for Her Majesty's Revenue and Customs
Decision date: 25 January 2011
Neutral citation: [2011] UKFTT 81 (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
This appeal concerned whether Mr Stephen Hare’s VAT registration covered both his finance broking and residential lettings businesses and whether exempt rent income should be included in Flat Rate Scheme turnover. The Tribunal held VAT registration applies to the person’s total business activities and that "relevant turnover" for the Flat Rate Scheme includes exempt supplies such as rent. HMRC’s assessments and interest under s.74 VATA were upheld 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
For the purposes of the Flat Rate Scheme a VAT registration is personal and covers all of the registrant’s business activities, so "relevant turnover" includes both taxable and exempt supplies (including rent); departmental guidance (Notice 733) and the statutory definition support including exempt supplies in flat rate turnover.
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 Tribunal noted Mr Hare acted in good faith with no suggestion of deliberate deception, and observed that interest charged under s.74 VATA serves as interest rather than a penalty.
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