Traders to take £6m back from HMRC

Traders have scored palpable hits in their struggle with HM Revenue and Customs (HMRC) over withheld VAT repayments.

Legal firm Dass Solicitors confirmed last week a VAT repayment of £2.7 million had been repaid by HMRC to an unnamed client, as HMRC withdrew its claim half way through a hearing at the Birmingham VAT and Duties Tribunal at the end of August.

Dass Solicitors said it is awaiting further funds which will take the amount received to more than £4 million.

In a further development, Brayfal Limited, trading as DRK, has also won its VAT case against HMRC at the Manchester VAT and Duties Tribunal, Mobile News understands.

Neither Brayfal’s management or legal team, led by prominent VAT lawyer Hassan Khan (pictured left), were available for comment.

However, it is understood tribunal chairman David Demack ruled HMRC should repay Brayfal around £1.8 million in VAT withheld under extended verification, as well as costs and interest.

Dass Solicitors secured around £400,000 for another client last month, the first VAT monies repaid to a trader since HMRC put in place extended verification in its fight against missing trader VAT fraud.

Dass Solicitors’ Alias Dass (pictured right) said: "This is the second verdict like this in quick succession. It shows these cases are winnable, provided proper and meticulous preparation is done."

The verdicts come as a major blow to HMRC, which has lost  VAT cases already this year to traders Olympia and Livewire, to the tune of around £9 million in VAT combined.

A joint appeal against those verdicts will be heard at the High Court in London in December.

A verdict is also due in trader Red12’s case against HMRC for around £4 million. Sources claims Red12’s hearing was "positive".