Christopher Swales v Revenue & Customs (VAT - BUILDERS : Do -it-yourself) [2019] UKFTT 277 (TC) (26 April 2019)

Christopher Swales v Revenue & Customs (VAT - BUILDERS : Do -it-yourself) [2019] UKFTT 277 (TC) (26 April 2019)

The Tribunal held that the construction was carried out in accordance with the planning consent because the consent and attached plans did not require retention of any part of the original shed above ground, and the planning authority was aware of and did not object to the demolition. The terminology used in the planning documents (e.g., 'annexe', 'ancillary') did not impose any restriction relevant to VAT legislation. Therefore, the condition in Note 2(d) was satisfied and the appellant was entitled to the VAT refund.

Citation
[2019] UKFTT 277
Parties
Appellant: Christopher Swales; Respondents: The Commissioners for Her Majesty’s Revenue & Customs
Jurisdiction
United Kingdom
Judgment Date
26 April 2019
Procedural Posture
VAT Refund Appeal (diy Builders Scheme) / First Tier Tribunal (tax) Substantive Decision
Outcome
Appeal allowed
Legal Topics
DIY Builders VAT Refund Scheme, Construction of Dwellings, Planning Consent Compliance, Interpretation of VAT Act 1994 Schedule 8 Group 5 Note 2(d)
Tax Law VAT DIY Builders VAT Refund Scheme Construction of Dwellings Planning Consent Compliance Interpretation of VAT Act 1994 Schedule 8 Group 5 Note 2(d)

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Parties

Christopher Swales

Appellant

The Commissioners for Her Majesty’s Revenue & Customs

Respondents

Procedural Posture

VAT Refund Appeal (diy Builders Scheme) / First Tier Tribunal (tax) Substantive Decision

Legal Issues

  1. 1 Whether the construction of the building met the condition in Note 2(d) to Group 5 Schedule 8 VATA 1994 (i.e., whether construction was carried out in accordance with statutory planning consent)
  2. 2 Whether the prohibition of separate use or disposal applied under Note 2(c)
  3. 3 Whether the works constituted construction of an annexe or a new dwelling for VAT purposes

Ratio Decidendi

The Tribunal held that the construction was carried out in accordance with the planning consent because the consent and attached plans did not require retention of any part of the original shed above ground, and the planning authority was aware of and did not object to the demolition. The terminology used in the planning documents (e.g., 'annexe', 'ancillary') did not impose any restriction relevant to VAT legislation. Therefore, the condition in Note 2(d) was satisfied and the appellant was entitled to the VAT refund.

Court Disposition

Appeal allowed

Orders

  • HMRC to refund VAT to the appellant under the DIY Builders scheme in accordance with s.35 VATA 1994.