Value Added Tax Act 1994, Schedule 11, paragraph 4

Power to require security and production of evidence

SCHEDULE 11 Administration, collection and enforcement

[F1898 4 (1) The Commissioners may, as a condition of allowing or repaying input tax to any person, require the production of such evidence relating to VAT as they may specify.

(1A) If they think it necessary for the protection of the revenue, the Commissioners may require, as a condition of making any dfnVAT credit, the giving of such security for the amount of the payment as appears to them appropriate.F1898]

[F1899 (2) If they think it necessary for the protection of the revenue, the Commissioners may require a taxable person, as a condition of his supplying or being supplied with goods or services under a taxable supply, to give security, or further security, for the payment of any VAT that is or may become due from—

(a) the taxable person, or

(b) any person by or to whom relevant goods or services are supplied.

(3) In sub-paragraph (2) above “relevant goods or services” means goods or services supplied by or to the taxable person.

(4) Security under sub-paragraph (2) above shall be of such amount, and shall be given in such manner, as the Commissioners may determine.

(5) The powers conferred on the Commissioners by sub-paragraph (2) above are without prejudice to their powers under section 48(7).F1899]

Definitions used in Schedule 11, paragraph 4 8

the Commissioners

“the Commissioners” means the Commissioners of Customs and Excise;

Defined in s.96(1) · see it in the full Act
input tax

“input tax” has the meaning given by section 24;

Defined in s.96(1) · see it in the full Act
VAT

“VAT” means value added tax charged in accordance with this Act;

Defined in s.96(1) · see it in the full Act
the credit

(4A) Subsection (3) above shall not require any such amount as is mentioned in paragraph (a) of that subsection (“the credit”) to be set against any such sum as is mentioned in paragraph (b) of that subsection (“the debit”) in any case where—

(a)an insolvency procedure has been applied to the person entitled to the credit;

(b)the credit became due after that procedure was so applied; and

(c)the liability to pay the debit either arose before that procedure was so applied or (having arisen afterwards) relates to, or to matters occurring in the course of, the carrying on of any business at times before the procedure was so applied.

Defined in s.81(4A) · see it in the full Act
taxable person

“taxable person” means a person who is a taxable person under section 3;

Defined in s.96(1) · see it in the full Act
supplied

(3) In sub-paragraph (2), “supplied” is to be construed in accordance with Part 1 of the Electricity Act 1989 (see section 64(1) of that Act ).

Defined in Sch.7A para.A1 · see it in the full Act

(3) In sub-paragraph (2), “supplied” is to be construed in accordance with Part 1 of the Electricity Act 1989 (see section 64(1) of that Act ).

Defined in Sch.8 para.3 · see it in the full Act
taxable supply

“taxable supply” has the meaning given by section 4(2);

Defined in s.96(1) · see it in the full Act
Relevant goods or services

(2) “Relevant goods or services”, in relation to a voucher, are any goods or services for the provision of which the voucher may be accepted as consideration.

Defined in Sch.10B para.2(2) · see it in the full Act

Cases considering Schedule 11, paragraph 4 7

FS Commercial Limited v The Commissioners for HMRC

[2026] EWCA Civ 29 · 27 January 2026

The judgment interprets the power to require VAT evidence as a condition of allowing or repaying input tax. It confirms that a lawful requirement may include production of a compliant invoice and that failure to comply can justify refusal (see paras [55], [72], [110]).

Customs and Excise & Anor v Federation of Technological Industries & Ors

[2004] EWCA Civ 1020 · 30 July 2004

Paragraph 4 was described as permitting Customs to require security for VAT where necessary to protect revenue, subject to tribunal appeal provisions. The underlying EU-law question concerning security was referred without deciding the provision’s validity. (see paras [22]-[27], [74])

FS Commercial Ltd v The Commissioners for HMRC

[2025] UKUT 13 (TCC) · 14 January 2025

HMRC may require production of specified VAT evidence as a condition of allowing or repaying input tax. The provision authorised HMRC’s request for the invoices and defeated the contention that Article 178 alone governed the issue (see paras [30]; [108]).

What each judgment says about Schedule 11, paragraph 4 is in the case-law panel in the full Act.

Amendments and notes

2 notes from legislation.gov.uk

Amendments

  1. F1898Sch. 11 para. 4(1)(1A) substituted for Sch. 11 para. 4(1) (retrospective to 10.4.2003) by Finance Act 2003 (c. 14), s. 17(3)(8)
  2. F1899Sch. 11 para. 4(2)-(5) substituted for Sch. 11 para. 4(2) (retrospective to 10.4.2003) by Finance Act 2003 (c. 14), s. 17(4)(8)