The Act restricted the extent to which payment made for the hire of vehicles exceeding certain values could be deducted from profits when calculating tax. Autolease hired cars and then relet them to the public. On the sale of the company the question arose as to whether that restriction might apply only to those cars … Continue reading Lloyds UDT Finance Limited v Chartered Finance Trust Holdings Plc and others: ChD 22 Nov 2001
Whether the appellant, Inmarsat Global Limited (‘Inmarsat’), is entitled to capital allowances on costs incurred by the International Maritime Satellite Organisation (‘IMSO’), to whose trade Inmarsat has succeeded, on the launch of certain satellites. The case raises questions as to the interpretation and application of sections 61(4) and 78 of the Capital Allowances Act 1990 … Continue reading Inmarsat Global Ltd v Commissioners for Her Majesty’s Revenue and Customs: CA 28 Jul 2022
The taxpayer sought to claim for capital allowances of andpound;91 million for gas pipelines. The claimant had provided the equipment through a leasing scheme. Held: The leases were unusual, but did not appear to be merely part of a tax avoidance scheme. However, here the company already owned and operated the pipeline, and continued to … Continue reading Barclays Mercantile Business Finance Ltd v Mawson (Inspector of Taxes): ChD 22 Jul 2002
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A ‘Planteria’ for the growing and storage of plants pending sale was premises, or a building, and not plant; no allowance was available. In considering the appeal, ‘the question for this Court, as it was for the Judge, is whether the facts found by the Commissioners are such that no person acting judicially and properly … Continue reading Gray (Inspector of Taxes) v Seymours Garden Centre (Horticulture): CA 31 May 1995
Capital allowances.The taxpayer operated automatic car wash sites. It claimed capital allowances for the entirety of a wash hall, housed within a building incorporating washing machinery and control equipment, and surrounded by tarmac areas used for circulation, queuing and parking. It said that the entire site, or entire wash hall, was a single item of … Continue reading H M Inspector of Taxes (Atwood) v Anduff Car Wash Limited: CA 17 Jul 1997
A glasshouse ‘planteria’ which was used to show plants in a garden centre, was premises and not plant for capital allowances purposes. Citations: Ind Summary 18-Oct-1993, Ind Summary 10-May-1993 Statutes: Capital Allowances Act 1990 22 Jurisdiction: England and Wales Citing: Appealed to – Gray (Inspector of Taxes) v Seymours Garden Centre (Horticulture) CA 31-May-1995 A … Continue reading Gray (Inspector of Taxes) v Seymours Garden Centre: Chd 10 May 1993
No capital allowances for car wash structures. They were part of premises, not plant. Judges: Carnwath J Citations: Times 11-Dec-1995 Statutes: Capital Allowances Act 1990 22 24 Jurisdiction: England and Wales Cited by: Appeal from – H M Inspector of Taxes (Atwood) v Anduff Car Wash Limited CA 17-Jul-1997 Capital allowances.The taxpayer operated automatic car … Continue reading Attwood (Inspector of Taxes) v Anduff Car Wash Ltd: ChD 11 Dec 1995
References: Ind Summary 18-Oct-1993, Ind Summary 10-May-1993 Ratio: A glasshouse ‘planteria’ which was used to show plants in a garden centre, was premises and not plant for capital allowances purposes. Statutes: Capital Allowances Act 1990 22 This case cites: Appealed to – Gray (Inspector of Taxes) v Seymours Garden Centre (Horticulture) CA (Times 31-May-95, Gazette … Continue reading Gray (Inspector of Taxes) v Seymours Garden Centre; Chd 10 May 1993
The taxpayer was a revenue informer one whose trade is described by Coke as ‘viperous vermin [who] under the reverend mantle of law and justice instituted for protection of the innocent, and the good of the Commonwealth, did vexe and depauperize the Subject, and commonly the poorer sort, for malice or private ends, and never … Continue reading Churchhouse, Regina (on the Application of) v Inland Revenue: Admn 4 Apr 2003
The use of a building for data processing does not qualify it as the subjection of goods or materials to any process and therefore no capital allowance was claimable. Citations: Times 06-Jan-1998, Gazette 11-Feb-1998, [1997] EWCA Civ 3061 Statutes: Capital Allowances Act 1990 18 Jurisdiction: England and Wales Citing: Appeal from – Girobank Plc v … Continue reading Girobank Plc v Clarke (HM Inspector of Taxes): CA 19 Dec 1997
‘The issue in the appeal is as to the true construction of section 35(2) in Chapter III of Part II of the Capital Allowances Act 1990 . . Section 35(2) restricts the extent to which expenditure on the ‘hiring’ of an ‘expensive motor car’ (that is to say, a car the retail price of which … Continue reading Britax International Gmbh v Commissioners of Inland Revenue: CA 31 May 2002
The part use of an industrial building as an office defeats a capital allowance claim. Citations: Gazette 01-May-1996, Times 21-Mar-1996 Statutes: Capital Allowances Act 1990 18 Jurisdiction: England and Wales Citing: Appealed to – Girobank Plc v Clarke (HM Inspector of Taxes) CA 19-Dec-1997 The use of a building for data processing does not qualify … Continue reading Girobank Plc v Clarke (Inspector of Taxes): ChD 21 Mar 1996
The applicant had obtained what it thought to be clearance from the Revenue for a complex scheme, whose effectiveness depended on whether investors would qualify for capital allowances. The Inspector initially gave a favourable assurance, but that was subsequently withdrawn. Held: The taxpayer’s application failed. A tax clearance certificate was properly withdrawn for a failure … Continue reading Regina v Inland Revenue Commissioners Ex Parte Matrix Securities Ltd: HL 14 Mar 1994
The taxpayers sought capital allowances on the costs of installing an artificial all-weather race track. Held: The track was not either plant or machinery, and the taxpayer was not eligible for the relief. The only reasonable conclusion was that the AWT operated as the premises. Judges: Lord Justice Mummery Lord Justice Potter Lord Justice Scott … Continue reading Lingfield Park (1991) Limited v Shove: CA 31 Mar 2004
The Revenue sought to disallow for industrial buildings allowance sums expended on warehouse premises which were to be used to store window products imported for use in other manufacturing processes. Held: The Revenue’s appeal succeeded. ‘The question under s.18(1) is whether the warehouse is in use for the purposes of a trade which consists in … Continue reading Revenue and Customs v Maco Door and Window Hardware (Uk) Ltd: ChD 19 Jul 2006
The father challenged a ruling that in calculating his liability to pay child support he was not entitled first to deduct, as a self-employed person, all the allowances he might claim against income tax by way of capital allowances. Held: The legislation is sloppy, muddled and would lead to unjust and absurd results. Nevertheless the … Continue reading Smith v Smith and Another: CA 19 Oct 2004
Equipment in Illinois was transferred to a UK company within the same group, then sold and leased back in order to take advantage of capital allowances. The Act provided for a reduction in the allowance where machinery was let to a foreign company, but subsection 3 removed the allowance altogether where the machinery was not … Continue reading BMBF (No 24) Ltd v Inland Revenue Commissioners: ChD 26 Nov 2002
The taxpayer, a non-resident, operated a sale and lease back scheme of machinery to be used in its business within the UK. There had been a chain of leases. Held: The court had first to identify the ‘relevant lease’. It was the head lease which was the lease of the machinery on which the expemse … Continue reading BMBF (No 24) Limited v the Commissioners of Inland Revenue: CA 6 Nov 2003
A distinction is to be found between the construction of plant and the equipment installed. The Court should examine the function of a structure to decide if it was a plant or a building for allowance. Citations: Gazette 09-Oct-1996, Times 01-Aug-1996 Statutes: Capital Allowances Act 1990 24 Corporation Tax Updated: 18 May 2022; Ref: scu.78546
Chattels which became affixed to a lessee’s land became fixtures, and were not available for tax allowances calculations. Lord Browne-Wilkinson said: ‘The terms expressly or implicitly agreed between the fixer of the chattel and the owner of the land cannot affect the determination of the question whether, in law, the chattel has become a fixture … Continue reading Melluish (Inspector of Taxes) v BMI (No 3) Ltd and Related Appeals: HL 16 Oct 1995
The taxpayer company operated a wholesale cash and carry business from a number of self-service supermarkets. The stores sold groceries, household goods, tobacco, confectionery and various kinds of alcohol. Although the buildings were not open to the public the customers who were mainly retail traders and caterers had access to most parts of the store … Continue reading Bestway (Holdings) Ltd v Luff (Inspector of Taxes): ChD 4 Mar 1998
The appellants had audited the books of the respondent company, but had failed to identify substantial frauds by an employee of the respondent. The auditors appealed a finding of professional negligence, relying on the maxim ex turpi causa non oritur actio. Held: (Mance and Scott LL dissenting) The appeal succeeded. The company could not bring … Continue reading Moore Stephens (A Firm) v Stone Rolls Ltd (in liquidation): HL 30 Jul 2009
The taxpayer, a race track owner, sought to claim the cost of laying an artificial all-weather race track surface as a capital allowance. The commissioners had found that it retained a separate identity from the grass, requiring maintenance and so forth, and that therefore it was plant, not premises. The revenue appealed. Held: The commissioners … Continue reading Shove (Inspector of Taxes) v Lingfield Park 1991 Ltd: ChD 21 Jul 2003
HL Judicial review – Capital allowances – Assurance given by local Inspector that capital allowances would be available under arrangements proposed by Enterprise Zone Property Unit Trust – Earlier letter from Revenue Head Office indicating that local level assurances would not be binding – Inspector’s assurance revoked by Head Office – Whether full and accurate … Continue reading Regina v Inland Revenue Commissioners Ex Parte Matrix Securities Ltd: HL 17 Feb 1994
The applicant contended that the 1991 Act infringed her human rights in denying her access to court to obtain maintenance for her children. Held: The applicant had no substantive right to take part in the enforcement process in domestic law which is capable in Convention law of engaging the guarantees in it. ‘Sympathetic though one … Continue reading Kehoe, Regina (on the Application of) v Secretary of State for Work and Pensions: HL 14 Jul 2005
Conditions for new evidence on appeal At the trial, the wife of the appellant’s opponent said she had forgotten certain events. After the trial she began divorce proceedings, and informed the appellant that she now remembered. He sought either to appeal admitting fresh evidence, or for a retrial. Held: The Court of Appeal refused to … Continue reading Ladd v Marshall: CA 29 Nov 1954
The company had paid substantial sums out in establishing a gas pipeline, and claimed those sums against its tax as capital allowances. The transaction involved a sale and leaseback arrangement which the special commissioners had found to be a pre-arranged series created only for a tax advantage, and the judge at first instance agreed saying … Continue reading Barclays Mercantile Business Finance Ltd v Mawson (HM Inspector of Taxes): HL 25 Nov 2004
