Customs rethink

Following a Court of Appeal decision, HM Revenue & Customs has been forced to consider repayment claims for over-declared output VAT on sales for the period prior to December 1996, subject to an appeal to the House of Lords.

Customs & Excise had previously brought in a three-year time cap to restrict repayment claims by opticians and other traders whose supplies were deemed to be a mixed supply.

Marc Bennett, a partner in chartered accountants AEL, which specialises in VAT and tax advice, said: 'Although this is extremely good news on the surface, opticians will need to have retained their original books and records relating to that period. Furthermore, HMRC will only make repayments if the taxpayer first signs an undertaking to reimburse Customs, including interest, if the judgement is eventually overturned in the House of Lords.'