Andrew Needham looks at what happens when HMRC gives a business incorrect advice or a ruling.
HMRC once had a generous policy on misdirection – although it was not necessarily generously applied! In Notice 48 (March 2002) Extra-Statutory Concessions, it stated:
‘If a Customs & Excise officer, with the full facts before him, has given a clear and unequivocal ruling on VAT in writing or, knowing the full facts, has misled a registered person to his detriment, any assessment of VAT due will be based on the correct ruling from the date the error was brought to the registered person’s attention.’
However, in Revenue & Customs Brief 15/09, HMRC announced that this concession was being withdrawn from 1 April 2009. HMRC then introduced a Statement of Practice giving the circumstances in which taxpayers could rely on its advice.
