TGH (Construction) Ltd v Revenue and Customs (VAT - ZERO-RATING : Building work) [2016] UKFTT 52 (TC) (01 February 2016)

TGH (Construction) Ltd v Revenue and Customs (VAT - ZERO-RATING : Building work) [2016] UKFTT 52 (TC) (01 February 2016)

The Tribunal held that the Workshop and Holme Terrace were constructed at the same time and on the same site, and were used together as a unit to provide relevant residential accommodation. The Workshop was integral to maintaining the residential buildings, and any non-residential use was de minimis. Therefore, the Workshop qualified for zero rating under Note 5 to Group 5 Schedule 8 VATA 1994.

Citation
[2016] UKFTT 52
Parties
Appellant: TGH (Construction) Ltd; Respondents: The Commissioners for Her Majesty’s Revenue & Customs
Jurisdiction
United Kingdom
Judgment Date
01 February 2016
Procedural Posture
VAT ZERO RATING : Building Work / First Tier Tribunal (tax) Substantive Decision After Preliminary Issue
Outcome
Appeal allowed
Legal Topics
Value Added Tax, Zero Rating, Construction of Buildings, Relevant Residential Purpose
Tax Law Value Added Tax Zero Rating Construction of Buildings Relevant Residential Purpose

Case Brief

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Parties

TGH (Construction) Ltd

Appellant

The Commissioners for Her Majesty’s Revenue & Customs

Respondents

Procedural Posture

VAT ZERO RATING : Building Work / First Tier Tribunal (tax) Substantive Decision After Preliminary Issue

Legal Issues

  1. 1 Whether the construction of a workshop, garage and store (the 'Workshop') at the same time as a relevant residential building (Holme Terrace) qualifies for zero rating under section 30 and item 2(a) to Group 5 Schedule 8 Value Added Tax Act 1994, by virtue of Note (5)
  2. 2 Whether the Workshop and Holme Terrace were 'used together as a unit solely for relevant residential purposes'

Ratio Decidendi

The Tribunal held that the Workshop and Holme Terrace were constructed at the same time and on the same site, and were used together as a unit to provide relevant residential accommodation. The Workshop was integral to maintaining the residential buildings, and any non-residential use was de minimis. Therefore, the Workshop qualified for zero rating under Note 5 to Group 5 Schedule 8 VATA 1994.

Court Disposition

Appeal allowed

Orders

  • The works associated with the construction of the Workshop are liable to VAT at the zero rate by virtue of Note 5 to Group 5 Schedule 8 VATA.