Haymarket Media Group Limited v The Commissioners for HMRC
Decision date: 18 May 2022
Neutral citation: [2022] UKFTT 168 (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
Haymarket sold a Teddington Site to a purchaser and HMRC assessed VAT, treating the sale as a standard supply rather than a transfer of a going concern (TOGC); the Tribunal dismissed Haymarket's appeal and upheld the £17m assessment. The Tribunal found Haymarket had not been carrying on a property development business in relation to the Site and that planning permission and related pre-sale steps did not by themselves constitute an ongoing development undertaking transferable as a TOGC. Leases created around exchange were judged to be tied to the purchaser and not to establish a transferred lettings business, so the transaction was a sale of land/assets, not a TOGC.
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: high
For a TOGC the assets transferred must together constitute an undertaking capable of carrying on an independent economic activity and there must be continuity of the same kind of business; obtaining planning permission and transferring related rights or consultant arrangements, absent an active development carried on by the transferor or intent to continue that business, does not create a transferable development undertaking, and short-term or purchaser‑arranged leases do not convert a land sale into a TOGC of a lettings business.
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 Tribunal noted that contemporaneous documents and commercial reality are important in assessing substance over contractual labels; that the VAT-grouping fiction does not change the real nature of the transferor’s business for TOGC purposes; and that parties' awareness of VAT risk and protective contractual arrangements are relevant to assessing intent though they do not determine TOGC status.