Mr Paul Mellor v Commissioners for Her Majesty's Revenue and Customs
Decision date: 30 December 2010
Neutral citation: [2011] UKFTT 29 (TC)
Overall AI summary confidence: high
Short overview
This short overview is intended to summarise the case, issues and outcome so far as they are supported by the judgment.
AI confidence in this short overview: high
This appeal concerned whether Mr Mellor’s home was the business base of his electrical subcontracting trade for 2006–07 and therefore whether travel from home to sites could in principle be deductible. The tribunal found on the facts that his home was his business base, so section 34(1) did not preclude deductibility in principle. The tribunal did not decide which specific claimed travel costs were deductible; Mr Mellor bears the burden of proving which journeys were incurred wholly and exclusively for the trade.
Ratio decidendi
This summary is intended to identify the ratio decidendi, meaning the legal reasons for deciding and the binding part of the decision.
AI confidence in this ratio decidendi summary: medium
Where a subcontractor negotiates contracts, keeps tools and business records, and uses the address for business, those facts can establish the taxpayer’s home as the business base; if the home is the business base, travel from that home to work sites can in principle be an expense incurred wholly and exclusively for the trade, subject to the taxpayer proving particular journeys and costs.
Obiter dicta
This summary is intended to identify obiter dicta, meaning observations made by the way that were not necessary to deciding the case and are not binding.
AI confidence in this obiter dicta summary: medium
The notes indicate commentary distinguishing Horton v Young and Newsom v Robertson based on where the centre of activities or true business base is located, and they observe that poor or contradictory contemporaneous travel records weaken an appellant’s ability to prove specific travel expenses were incurred wholly and exclusively for the trade.