The dual applicants, Promeridian Services Limited and director Leon Marian, disputed a decision by HMRC to deny input tax of £559,896.00 for purchases of labour across VAT returns 02/20, 05/20, 08/20 and 11/20, issued in March 2021 using the Kittel principle.

In addition, subsequently HMRC issued a penalty for £167,968.00, being 30% of the input tax denied, in April 2021, and sought to deregister the company for VAT.

Promeridian was incorporated on the 11 February 2019 and registered for VAT on the 1 September 2019. Mr Marian was the sole director and shareholder of the company, which started offering commercial glazing then progressed to doing cladding, drylining and commercial interiors.