Three small businesses have won their appeal against the taxman’s requirement that they file their VAT returns online, in what campaigners say is a victory for human rights.
According to the Low Incomes Tax Reform Group, a charity which supported the trio, two of the businesses owners had disabilities which made it excessively difficult for them to use a computer.
The third appellant, who like his counterparts was of an age where learning how to use a computer was difficult and would have had to instruct an accountant, lived in an area of the UK where broadband access was absent or unreliable.
Unifying all three was the fact that each business owner had filed their VAT returns promptly and accurately on paper for many years, before HM Revenue & Customs mandated an online system for such returns.
Going before the first-tier tax tribunal, they were handed a ground-breaking decision by the judge, who held that the rules requiring online VAT filing which fail to provide exemptions for the old, disabled or disadvantaged from broadband, breached their human rights and are unlawful under EU law.
“This case shows that HMRC must consider the needs of taxpayers when making regulations about complying with VAT and other tax requirements,” said LITRG’s chair Anthony Thomas.
cannot just act in isolation without regard for the human rights of taxpayers
and to other provisions of the general law of the land. When making policy and
promulgating regulations HMRC, like all other public authorities, must obey the
rule of law.”
He added that the verdict means that HMRC’s digital mandation is a policy that contravenes the rule of law, when the policy fails to make provision for the needs of older or disabled people, or those who cannot access broadband easily because of where they live.
“Any assistance HMRC offers to taxpayers in complying with their obligations must be responsive to the diverse needs of the people it is supposed to help,” said Mr Thomas.
remain willing to work with HMRC to ensure that those who cannot use online
channels for reasons of disability, age and so forth are treated appropriately
and in accordance with the law. This must involve giving them alternative means
of complying with their tax obligations – including paper filing – that are workable
and meet their particular needs.”