The First Tier Tribunal (FTT) ruled that if HMRC repaid £1.7m of mistakenly paid VAT back to the Mayor’s Office for Policing and (MOPAC) then it would ‘unjustly enrich’ the department, dismissing the appeal against HMRC’s decision to withhold the repayment.

Between 2012-17, four VAT claims were submitted by MOPAC to HMRC for overpaid VAT worth £1.7m on the sale of private vehicles at an auction after they were seized. The final claim was submitted in March 2017.

Under a statutory process followed by the MOPAC, the vehicles were secured in storage facilities until the owners paid a statutory fee for the vehicle to be released.