Payne & Ors v Revenue And Customs [2020] EWCA Civ 889 (20 July 2020)

Payne & Ors v Revenue And Customs [2020] EWCA Civ 889 (20 July 2020)

The statutory test under section 115(2) ITEPA 2003 requires determining whether the construction of the vehicle as a whole, at the relevant time, is primarily (i.e., predominantly or first and foremost) suited for the conveyance of goods. This requires more than a marginal advantage and must be assessed in the round, considering all features, including removable seating. The Court rejected the approach that focuses solely on appearance, original design, or trade/private vehicle dichotomy. The FTT and UT erred in applying a 'narrow balance' or 'typicality' test and in treating marginal suitability as sufficient. As a result, neither the Kombis nor the Vivaro were shown to be primarily...

Citation
[2020] EWCA Civ 889
Parties
Appellant/respondent: Noel Payne; Appellant/respondent: Christopher Garbett; Appellant/respondent: Coca-Cola European Partners Great Britain Limited; Respondent/appellant: The Commissioners for Her Majesty's Revenue and Customs
Jurisdiction
England and Wales
Judgment Date
20 July 2020
Procedural Posture
Appeal / Court of Appeal (civil Division) Judgment on Appeal From Upper Tribunal (tax and Chancery Chamber)
Outcome
Appeals dismissed; HMRC's cross-appeal allowed.
Legal Topics
Income Tax, National Insurance Contributions, Statutory Interpretation, Employment Benefits, Vehicle Classification
Tax Law Employment Law Income Tax National Insurance Contributions Statutory Interpretation Employment Benefits Vehicle Classification

Case Brief

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Parties

Noel Payne

Appellant/respondent

Christopher Garbett

Appellant/respondent

Coca-Cola European Partners Great Britain Limited

Appellant/respondent

The Commissioners for Her Majesty's Revenue and Customs

Respondent/appellant

Procedural Posture

Appeal / Court of Appeal (civil Division) Judgment on Appeal From Upper Tribunal (tax and Chancery Chamber)

Legal Issues

  1. 1 Whether the Vauxhall Vivaro and VW Transporter T5 Kombi vans are 'goods vehicles' or 'cars' under section 115 ITEPA 2003 for tax and NIC purposes
  2. 2 Proper construction of 'goods vehicle' and 'primarily suited' in section 115(2) ITEPA 2003

Ratio Decidendi

The statutory test under section 115(2) ITEPA 2003 requires determining whether the construction of the vehicle as a whole, at the relevant time, is primarily (i.e., predominantly or first and foremost) suited for the conveyance of goods. This requires more than a marginal advantage and must be assessed in the round, considering all features, including removable seating. The Court rejected the approach that focuses solely on appearance, original design, or trade/private vehicle dichotomy. The FTT and UT erred in applying a 'narrow balance' or 'typicality' test and in treating marginal suitability as sufficient. As a result, neither the Kombis nor the Vivaro were shown to be primarily...

Court Disposition

Appeals dismissed; HMRC's cross-appeal allowed.

Orders

  • The Kombis and Vivaro are not 'goods vehicles' for the purposes of section 115 ITEPA 2003 and are to be treated as 'cars' for tax and NIC purposes.
  • The appeals by the Taxpayers are dismissed.