Clothing retailer loses £190k tax dispute

The owner of a clothing business has lost an appeal in the First Tier Tribunal (FTT) against penalty assessments related to the submission of inaccurate VAT returns

The appellant, Zakir Hussain Hashmi, disputed an HMRC VAT assessment totalling £122,665 regarding inaccuracies in the relevant VAT returns relating to over-declared input tax and under-declared output tax.

In addition, Hashmi was also charged a personal liability notice (PLN) under schedule 24 Finance Act 2007 (FA07) for £65,801.50, of which £50,203.65 was in dispute.

HMRC raised the assessments against Apollinaire Limited, which Hashmi was the sole director and shareholder of, for inaccuracies in his VAT returns.

At the heart of the appeal is the assertion that Hashmi had allegedly sold his business, Snow Whyte Limited to Navinder Singh for £25,000.

The appellant alleged that Singh had traded for one month, before selling stock worth £573,756 to Apollinaire.