HMRC will not appeal against the decision of the First-tier tribunal in Robinson Family Limited v HMRC TC 2046, and has announced that it now accepts that ‘the fact that the transferor of a property rental business retains a small reversionary interest in the property transferred does not prevent the transaction from being treated as a [transfer of a going concern] for VAT purposes’.
Jonathan Legg, partner at Mishcon de Rey, observed in July that the tribunal decision had ‘driven a coach and horses’ through HMRC’s stance, ‘certainly in situations which are on all fours with the Robinson case’. Writing in Tax Journal, Legg said HMRC’s rationale was that the grant of a lease was the creation of a new interest, not the transfer of an existing one.
HMRC will not appeal against the decision of the First-tier tribunal in Robinson Family Limited v HMRC TC 2046, and has announced that it now accepts that ‘the fact that the transferor of a property rental business retains a small reversionary interest in the property transferred does not prevent the transaction from being treated as a [transfer of a going concern] for VAT purposes’.
Jonathan Legg, partner at Mishcon de Rey, observed in July that the tribunal decision had ‘driven a coach and horses’ through HMRC’s stance, ‘certainly in situations which are on all fours with the Robinson case’. Writing in Tax Journal, Legg said HMRC’s rationale was that the grant of a lease was the creation of a new interest, not the transfer of an existing one.
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