AW Kerr (t/a Grantham House) v HMRC

In AW Kerr (t/a Grantham House) v HMRC (TC00917 – 1 February) an individual (K) took a lease of a historic house built in 1380 from the National Trust in September 2006. He began repairing the property and restoring the gardens and in October 2006 he opened the house to visitors. In his 2006/07 tax return he claimed that he had made a substantial trading loss which should be set against his other income. HMRC rejected the claim considering firstly that his exploitation of the property did not amount to a trade and alternatively that if it did amount to a trade it had not been conducted on a commercial basis. K appealed. The First-Tier Tribunal allowed his appeal in principle (subject to agreement as to figures). Judge Radford found that K had shown an intention ‘to run the property as a business...