Build a Bear Workshop UK Holdings Ltd (appellant) v Her Majesty’s Revenue & Customs (respondent)

Wednesday 11 May 2022

Second appeal. The taxpayer Build-a-Bear Workshop UK Holdings Limited (The Appellant) appeals the Upper Tribunal (Tax and Chancery Chamber) order of Joanna Smith J and Ashley Greenbank J dated 29 March 2021 by which it dismissed the appeal against a decision of the First-tier Tribunal date 27 November 2019 which upheld HMRC’s C18 Post Clearance Demand Notes dated 7 June 2012, 27 June 2012 and 28 November 2012.

Build-A-Bear group is a global retailer of stuffed toys together with `accessories’ for those toys. The issues between the parties relate to the correct classification for customs duty purposes of various of the `accessories’ imported by the Applicant.

On 18 October 2012 and 22 July 2013, HMRC upheld the issue of three C18 post-clearance demands in respect of customs duty and import VAT on the basis that the Applicant had not correctly declared the import of certain goods for the purposes of the Combined Nomenclature. On 13 July 2015, HMRC upheld a decision to refuse to repay customs duties and import VAT in respect of such goods. The Applicant appealed these decisions to the FTT. The commercial significance of the appeal is that the classifications upheld by HMRC generally attract a customs duty at 4.7%, whereas the classifications for which the Applicant contends would attract customs duty at 0%.

The FTT and the Upper Tribunal both upheld HMRC’s decision.

View hearing:

Part 1

Part 2

Part 3