Provided the High Court Enforcement Officer’s (HCEO) business is registered for VAT, then he will add VAT to his fees, costs and charges where applicable.
This then gives rise to the question of whether a VAT registered judgment debtor can recover input tax on those charges where VAT was applicable.
In general terms, a VAT registered entity may only recover input tax that relates to its taxable business supplies or services. HMRC has previously advised that as neither the creditor nor debtor is the recipient of these supplies or services they may not reclaim the input VAT.
As a result, there is no requirement for HCEOs or others in the enforcement industry to issue VAT invoices and it is advised that any document issued for this purpose should state that it is not a VAT invoice.
If a judgment debtor still believes he can reclaim input VAT from the HCEO’s invoice for enforcement against his VAT registered business, he is advised to seek clarification from his accountant and/or HMRC.