Summary
This was an appeal against the issue of a personal liability notice (PLN) in 2017 against the sole director of a company that was likely to become insolvent and that the appellant, as its sole director, was responsible for the inaccuracies in the company's VAT returns that had been identified by HM Revenue and Customs (HMRC). HMRC issued the PLN against Mr Powar, making him personally liable to pay the penalty of £74,823.63.
Background
The appellant’s company was an alcohol wholesaler. Although a trader is entitled as of right to claim a deduction of input tax, there is an exception to this principle where a trader knew or should have known that, by its purchase, it was taking part in a transaction connected with fraudulent evasion of VAT. This is because, in such a situation, the trader is an ‘accomplice’ and aids the perpetrators of the fraud (seeâ¯Axel Kittel v
