Value Added Tax Act 1994 section 85A

Payment of tax on determination of appeal

Section 85A deals with what happens to disputed VAT amounts and VAT credits after a tribunal has decided the outcome of a VAT appeal.

• Where the tribunal finds that VAT was overpaid or a VAT credit was not paid to the taxpayer, HMRC must pay or repay the relevant amount to the appellant
• Where the tribunal finds that VAT was underpaid or a VAT credit was wrongly paid, the taxpayer must pay or repay the relevant amount to HMRC
• The section applies to appeals determined under section 83 of the VAT Act 1994, which sets out the categories of decisions that may be appealed
• The provision works in both directions — ensuring money flows to whichever party the tribunal determines is entitled to it