South West Accountant Wins Landmark VAT Tribunal – Old Mill helps client to victory in three-year tax case

Leading South West accountancy firm Old Mill has helped one of its clients to victory in a landmark VAT case in a London tax court.

Old Mill has been battling with HM Revenue and Customs (HMRC) over whether digital printing and photo-processing firm Harrier Truprint, based in Newton Abbot, should have been paying VAT on the sale of its photo books.

“It was all about whether photo books should be defined as books, and therefore be zero rated, or as photo albums and be subject to VAT,” explains Old Mill’s VAT director Mark Peters, whose expertise helped win the case. “HMRC’s case was based on an argument that photo books were not books because they often had no content, only pictures.”

But London VAT Tribunal Judge Roger Berner dismissed HMRC’s claims stating: “A book can have content that is exclusively text, or exclusively material such as photographic images or diagrams or drawings, or any mixture of that content,” and ordered them to repay £545,800 to Harrier Truprint to cover the tax years 2006 to 2009.

 “This case has been a long and hard battle, but a very significant one” says Mr Peters. “Because the law was unclear about whether a photo book was a book, there was inconsistency in the industry and while Harrier Truprint were paying 20% VAT on the sale of their photo books, many of their competitors were not.”

Harrier Truprint’s finance director Graham Clark, who says he is relieved the case is finally over, says as a South West firm, it is reassuring to know that the expertise needed to win such a significant case is right on your doorstep.

“VAT is such a complicated area, and we are grateful to have such high quality accounting expertise locally available,” he said. “Thanks to Old Mill’s expertise on this matter, common sense has prevailed, the playing field has been levelled and we can finally compete on fair terms.

Mr Clark concluded, “We have always offered fantastic quality photo books via our Harrier Truprint.co.uk website – our customers create anything from novels to diaries, recipe books, short stories and even autobiographies. Our ‘This is your life’ type books are also very popular as you can digitally scan and use all your old photographs in your photo book, which make fantastic affordable and unique Christmas presents.

“Winning this case gives us the opportunity to significantly expand our book production business in 2012 in both photo-books and commercial book printing which is likely to create additional jobs in the future and enable us to become a major player in the photo book industry on a regional, national and international scale.”

For more information please contact Alan Stone on 01749 335007 or alan.stone@oldmillgroup.co.uk