Postby Orchardcattery » Wed May 19, 2010 8:18 pm
I've been asked for an update. I would love to be able to answer your question.... but I can't! We went to a tribunal hearing on March 10th, and are still waiting to hear now in the 10th week, and 18 months after our original claim. I phoned last week, but they couldn't tell me anything - it takes as long as it takes. There have been delays all the way down the line - correspondence being lost etc etc, so the first piece of advice is, if you do decide to pursue it, be very patient!
I think rather than go into the arguments we used at this stage, we ought to wait to see whether they were successful. If they are, I'll certainly give you whatever help I can. Not that I have any professional qualifications, but those who have will fight shy of you because it takes hours of time to prepare a case, and could be very expensive if there's a chance you won't win. Struggling with the loss of almost £14k put us at an immediate disadvantage - they had a solicitor and a barrister, so the case probably cost them more than the amount we were claiming!
Meanwhile it may help you to Google 'V1-6' This will get you to HMRC's guidance for deciding what is and what is not a business activity. Was the construction of your home a business activity when you apply their business tests? One of our arguments was that they didn't seek to apply this test when determining our decision.
In answer to the correspondent who asked why we had not registered for VAT and claimed back the input tax, we were advised by our accountant that we would only be able to claim for the small proportion of the house which is used as an office, and not for our private accommodation - see VAT guidance 700 paras 33.2 and 33.6.
I'll post the results as soon as I know them. I don't know how quickly they will post the decision on the web site for you to read