Judgment summary
This decision concerns Winchester City Council's (WCC) appeal against HMRC's refusal of a claim for overpaid VAT relating to disabled facilities grant administration fees for the period May 2021 to March 2023 (the "Relevant Periods") (6).
WCC had made an earlier claim on 31 May 2023 covering the Relevant Periods, which HMRC rejected on 15 August 2024, and which WCC did not appeal (7-9). On 27 May 2025, WCC made a further claim covering a wider period, including the Relevant Periods, advancing that the fees should be treated as exempt or outside the scope of VAT (10). HMRC rejected this later claim on 15 July 2025 on the basis that an earlier claim had already been made for the Relevant Periods (11). WCC appealed to the Tribunal on 15 July 2025 (12).
The Tribunal had to decide whether the 27 May 2025 claim was a valid claim under section 80 Value Added Taxes Act 1994 (VATA 1994), or an impermissible repeat claim or abuse of process (13). The Tribunal held that the claim was valid because it advanced a materially new legal basis, namely that the supplies were outside the scope of VAT, in addition to the earlier argument that they were exempt (29-30). As a result, the Tribunal found the appeal was made in time and allowed it (37, 39).
Background
WCC's appeals related to three periods of VAT claims concerning disabled facilities grant administration fees. The period April 2023 to April 2025 was agreed by both parties to be in time and was not considered further (6(a)). The period May 2019 to April 2021 was treated as withdrawn after WCC confirmed it was not seeking permission to appeal that period late (6(c)). The present application concerned the Relevant Periods, May 2021 to March 2023 (6(b)).
On 31 May 2023, WCC's predecessor to Mr Boulton submitted a claim stating that the disabled facilities grant administration fees should be treated as exempt from VAT (7). HMRC rejected this claim on 15 August 2024, and WCC did not appeal that rejection; Mr Boulton, who gave unchallenged evidence, did not know why no appeal had been made (8-9).
On 27 May 2025, Mr Boulton, unaware of the earlier claim, submitted a further claim covering May 2019 to March 2023, including the Relevant Periods, asserting that the fees should be treated as either exempt from VAT as a welfare service or outside the scope of VAT because the Council was acting in a non-business capacity (10). HMRC rejected this claim for the Relevant Periods on 15 July 2025 on the ground that an earlier claim already existed for those periods (11). WCC appealed to the Tribunal the same day (12).
Core dispute
The Tribunal was required to determine whether the claim made on 27 May 2025 was a valid claim under section 80 VATA 1994, or whether it should instead be treated as an impermissible repeat claim or an abuse of process (13).
WCC argued that section 80 VATA 1994 permits claims within the four year statutory time limit and does not prevent a further claim simply because an earlier claim was rejected by HMRC, particularly where no appeal had been made against the earlier rejection and there had been no court determination or statutory agreement preventing a second claim (14). WCC relied on Hayward Gill & Associates ([1998] VTD 15635) (14(c)).
HMRC argued that the only valid claim for the Relevant Periods was the 31 May 2023 claim, that WCC was therefore appealing late, and that under the principles in Martland v HMRC ([2018] UKUT 178 (TCC)) the Tribunal should not exercise its discretion to permit a late appeal. HMRC further argued that the 27 May 2025 claim was, in substance, an attempt to circumvent section 83G VATA 1994 time limits for appeals and the requirement to seek permission for a late appeal, and constituted an abuse of process undermining finality and legal certainty (15).
Court findings
The Tribunal first found that the claim made on 27 May 2025 was a valid claim under section 80 VATA 1994, and that the real question was whether it was merely repetitive or advanced something new so as not to be abusive (28).
The Tribunal found that the 31 May 2023 claim raised a single ground, that the supplies were exempt, whereas the 27 May 2025 claim raised two arguments, that the supplies were either exempt or outside the scope of VAT. The Tribunal held that a different legal characterisation of the same supplies is capable, in principle, of constituting something new, and that the additional legal basis in the later claim met the low hurdle identified in Cambria Automobiles (South East) Ltd v Revenue and Customs Commissioners ([2021] UKFTT 406 (TC)) (29).
The Tribunal held that Mr Boulton's lack of knowledge of the earlier claim did not affect the character or validity of the later claim, since the question of whether a claim says something new is assessed by reference to its content, both factual and legal, not the claimant's subjective state of knowledge (30).
The Tribunal emphasised that its conclusion was reached on the particular facts of the case and should not be taken as endorsing the general permissibility of repeated claims raising no materially different basis; a claim merely repeating an earlier claim without material difference would be liable to be rejected as abusive (31).
Drawing on Lord Millett's observations in Johnson v Gore Wood & Co [2001] 1 All ER 481, the Tribunal noted that WCC was being asked to litigate for the first time the question of VAT treatment of the fees, and that the statutory scheme distinguishes between making a claim under section 80 and appealing its rejection; the existence of appeal time limits does not, of itself, preclude a further claim within the statutory limitation period, subject to abuse of process principles (32).
Applying the "broad, merits-based" approach from Johnson v Gore Wood, the Tribunal found no prior adjudication of the VAT treatment by a court, Tribunal, or section 85 VATA 1994 agreement, and concluded that the second claim was not oppressive, unfair, or an abuse bringing the administration of justice into disrepute (33).
The Tribunal rejected HMRC's submission that the second claim circumvented statutory appeal time limits, noting that section 80 claims are freestanding and that further claims may be made subject to abuse principles, and that HMRC had not established that the claim was oppressive or improper (34).
The Tribunal concluded that the later claim was not barred by principle or authority, consistent with John Wilkins (Motor Engineers) Ltd v Revenue and Customs Commissioners ([2010] EWCA Civ 923), which recognises that repeat claims are not excluded in principle but may be rejected where abusive (36).
Outcome
The Tribunal concluded that the claim made on 27 May 2025 is a valid claim under section 80 VATA 1994, is not a purely repetitive claim, and does not constitute an abuse of process. HMRC had not discharged the burden of establishing that the claim was abusive (38).
As the 27 May 2025 claim was valid, the Tribunal held that WCC's appeal was made in time, making it unnecessary to consider whether to admit the appeal late (37). The appeal was allowed (39).
Major issues / areas of contention
- Whether the claim made by WCC on 27 May 2025 was a valid claim under section 80 VATA 1994.
- Whether the 27 May 2025 claim was merely a repeat of the earlier 31 May 2023 claim, or advanced something materially new in fact or law.
- Whether the 27 May 2025 claim constituted an abuse of process by circumventing statutory appeal time limits under section 83G VATA 1994 and the requirement to seek permission for a late appeal.
- Whether, if the 27 May 2025 claim was invalid, the Tribunal should exercise its discretion under the Martland v HMRC principles to permit a late appeal.
- The relevance of prior authorities, including Hayward Gill & Associates, John Wilkins (Motor Engineers) Ltd, and Cambria Automobiles (South East) Ltd, on the permissibility of successive VAT repayment claims.