The House of Lords held in Conde Nast Publications Limited v HMRC 2008 [UKHL] 2 that the failure of the UK government to include a transitional period for the introduction of a three year cap on input tax claims made from 1 May 1997 was a breach of EU law. The effect of the Conde Nast decision is that businesses can claim a refund for VAT overpaid or under claimed from 1973 to 1997 provided such claims are submitted by 31 March 2009.  

Eligible businesses are those registered for VAT between 1 April 1973 and 1 May 1997 who either declared more output VAT than they were liable for or claimed less input VAT than they were entitled to.  

Businesses may benefit from larger than expected refunds as HM Revenue & Customs have since 1997 conceded that input VAT recovery is available in relation to a wider range of standard business expenses than was the case prior to 1997. Furthermore, businesses will also benefit from statutory interest on any VAT refunds. For those businesses which have already made protective claims, they may wish to review those claims in light of subsequent court decisions which may have increased the scope for VAT recovery since the claim was made. All claims must be submitted by 31 March 2009.