KE Entertainments loses appeal for backdated VAT monies

UK Supreme Court KE Entertainments HMRC VAT overpayments
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There was a disappointing outcome at the UK Supreme Court for bingo operator KE Entertainments whose appeal to overturn a decision by HMRC not to repay £435,630 in taxes for the period 1996-2004 was turned down.


The five justices unanimously agreed that the company’s claim for a refund fell outside the term of three years which permitted for claims to adjust overpayments in VAT paid.

Whilst much of the appeal focused on the methodology used for calculating tax dues, which had changed in 2007, the justices felt that overpayments for the three years prior to the rule change were legitimate, but the years previous to 2004 were not eligible.

The appeal ends a seven year legal wrangle over the interpretation of VAT calculation practices on bingo machines.

In the appeal judgement Lord Leggatt noted that 14 similar cases were pending, with a total value between £30m and £40m in the reckoning.

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