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Tax Investigation Specialists - Call 0800 734 3333 or email scott.gilbert@gilberttax.co.uk

Kittel Notice

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Our primary goal is to allay any feelings of concern or anxiety you may be experiencing at this stressful time. We will give you a clear, objective appraisal of your tax position and the options available to you.

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Want to learn more about HMRC Disclosure Facilities before arranging your free consultation? There's lots of useful information on this page covering:

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  • Topic 3

Still unsure if you need professional tax advice? Find out why it is so important to speak with a tax expert before engaging HMRC. Click here to learn more.

To speak to someone about this at Gilbert Tax Craig Tully is the dedicated partner so please email him directly at craig.tully@gilberttax.co.uk call 07786 226013 or fill in the contact form and he will get back to you as soon as he can.

Notice to deny input tax

If you have received a letter or assessment from HMRC that says ‘notice to deny input VAT’ and refers to a tax case called ‘Kittel’ then HMRC believe that you have been involved with a transaction where VAT has been lost and you knew or should have known that the VAT would not be paid due to the fraudulent evasion of VAT.  This is exceedingly complex and we recommend that the business who receives the notice take immediate action and contact someone who deals with Kittel issues on a regular basis.

In effect, HMRC are telling you that they are going to deny your business the input tax you previously claimed in this transaction and expect your business to pay that VAT back to them, immediately!  If this is not dealt with as a matter of urgency by someone who is familiar with all the Kittel issues this could cause significant financial harm to your business and potentially you.

These are very complex cases and any notice issued by HMRC should be appealed against without delay, even if your appeal is not fully complete it is important to register your disagreement in principal within the deadline stated on the notice. Although late appeals can be allowed, they present a problem in themselves and can be complex and costly to deal with.

The points HMRC need to prove

In these cases there are three points for HMRC to prove, although they appear straightforward the underlying detail and understating of the law is important.

The tests are as follows:

  1. Was their fraudulent evasion of VAT?  This does not have to be in your business it is usually in another business HMRC are aware of.
  2. Was the transaction entered into by your business ‘connected with’ that fraudulent evasion of VAT?  This can be buy entering into a transaction with a third party.
  3. That you or your business, when it entered into the transaction, knew or should have known that it was ‘connected with the fraudulent evasion of VAT’.  HMRC often try to say that processes were not robust enough to check that the transaction was not fraudulent.

HMRC frequently assert that the above tests are passed without any proper investigation to meet targets as this is a political issue and therefore you are presented with a ruinous demand for money without any proper enquires being carried out by HMRC.  Having an advisor who is familiar in dealing with Kittel issues and HMRC’s lack of fact finding can make all of the difference as if such allegations are not quickly and robustly challenged can lead to issues if the matter needs to progress to Tribunal.

How Gilbert Tax can help

Gilbert Tax have extensive experience of dealing with these demands and notices including reviewing evidence presented by HMRC and examining the way HMRC have carried out their investigation so that negotiations can commence to deal with the problem.

If HMRC are intransigent, then we also have the back up for experienced Counsel (Barristers) on this issue should it be necessary to take HMRC to the Tax Tribunal.

It is important that anyone receiving a Kittel assessment takes immediate action to give you and your business the best challenge of defending these claims.

We are aware that sometimes people think that they can deal with the notice themselves and that HMRC will be reasonable as they do not want to incur professional costs.  Our experience is that HMRC are not reasonable with regards to Kittel notices and without experience and knowledge of the full process businesses get themselves further into difficulties as their explanations are twisted to support HMRC argument.

In the matter of Kittel assessments, we would suggest that you cannot afford not to get professional help.

To speak to someone about this at Gilbert Tax Craig Tully is the dedicated partner so please email him directly at craig.tully@gilberttax.co.uk call 07786 226013 or fill in the contact form and he will get back to you as soon as he can.

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Client Story
How Can We Help?
Tax Investigation Specialist
Scott Gilbert, Partner

"We understand that people sometimes make mistakes in their dealings with HMRC and that HMRC make mistakes in dealing with taxpayers. Many people do not know how to deal with HMRC or who to turn to for help resolve the tax dispute.

Our firm of tax advisors specialise in resolving people's problems with HMRC. We have extensive expertise in dealing with all forms of tax investigations and tax disputes as well as with taking matters to the Tax Tribunal where agreement cannot be reached.

We deal both directly with the individual who is under enquiry and also work with many firms of accountants supporting them in dealing with HMRC disputes and advising them on how to handle HRMC to get the best result.

The fact is that proper management of HMRC is the best way of reducing the tax, interest and penalty as well as the time taken in resolving any tax dispute.

Our expert team are none judgemental and rigorously defend your position within the scope and parameter of the law. We take control and manage the process to minimise the interruptions that any form of tax investigation causes to an individual's life and business."

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