In HMRC v Vodafone Group Services [2106] UKUT 89, the UT has held that a claim for repayment of VAT cannot be amended so as to include later claims relating to different transactions.


In 2007, Vodafone wrote to HMRC requesting a repayment of over £4m, representing the amount by which it claimed to have over-declared its liability for output tax under the Nectar card scheme in its VAT returns for the periods 01/04 to 01/06 (the Nectar claim). The Nectar claim remained outstanding and was the subject of a separate appeal to the FTT.

Between 2009 and 2011, Vodafone made additional claims for the repayment of further output tax which it had over-declared in accounting periods including those covered by the Nectar claim (the later claims). The later claims were separate from the Nectar claim and related to other accounting errors. HMRC refused to repay some of the later claims on the ground that they had been made out of time.

Vodafone accepted that had the later claims been freestanding they would fail as they were out of time. However, they argued that it was possible to amend the Nectar claim so that it encompassed the later claims. HMRC disagreed. HMRC accepted it was possible to amend a claim, but argued that it was not permissible to do so in the way Vodafone claimed as its approach amounted to replacing one claim with another.

The matter came before the FTT which considered, as preliminary issue, whether a taxpayer could vary the methodology by which a claim was calculated (eg by substituting a different reason for claiming an identical or lower amount) after the expiry of the time limits set out in section 80, VATA 1994. The FTT found in Vodafone’s favour and HMRC appealed to the UT.

The UT’s decision

The UT confirmed that a claim is a demand for repayment of overpaid tax. It rejected Vodafone’s argument that a claim is defined by its amount alone. The UT was of the view that such an approach was inconsistent with the statutory language. In its view, a claim is not simply a sum of money in abstract, but for an amount which relates to a particular transaction in respect of which output tax has been accounted. It was therefore not possible for a taxpayer to extend a claim to include entirely different transactions.

The UT therefore concluded that the later claims were not subsumed within the Nectar claim and allowed HMRC’s appeal.

In reaching its conclusion the UT acknowledged that Reed Employment v HMRC [2013] UKUT 109, was authority for the proposition that “a claim could be amended, even if the amendment consisted of a change in the amount claimed or the method of calculation, as long as the fundamental character of the claim was unchanged; in other words, the amended claim had to arise out of essentially the same facts or circumstances as original claim”. It commented that this was consistent with its own conclusion that it is the amount and method of calculation which define the claim.


This decision provides some clarity on the scope of permitted amendments to existing section 80 claims. It is clear that the UT will not tolerate attempts by taxpayers to enlarge existing claims with elements that were not in contemplation when the claim was originally made.

A copy of the UT’s decision is available to view here.