Mr David Sherratt and Mrs Elizabeth Sherratt v Commissioners for Her Majesty's Revenue and Customs
Decision date: 13 May 2011
Neutral citation: [2011] UKFTT 320 (TC)
Overall AI summary confidence: high
Short overview
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AI confidence in this short overview: high
The Sherratts claimed a £13,082.81 VAT refund under the DIY builders' scheme for a self‑built farmhouse. HMRC denied the refund on the basis that planning conditions prevented separate use or disposal of the farmhouse. The First‑tier Tribunal found the planning restrictions did prevent separate disposal/use and dismissed the appeal, holding the supply was standard‑rated and no VAT repayment was due.
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
A planning condition providing that a dwelling "shall not be sold, leased nor otherwise disposed of separately from, the remainder of the premises" prevents separate disposal or separate use for the purposes of Note 2(c) to Group 5 of Schedule 8; where such a prohibition exists the DIY builders' VAT refund does not apply.
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 observed that "separate use" in Note 2(c) is properly read as "separate from" and is not confined to separation from another dwelling, and that the lack of other substantial buildings on the remainder of the premises does not prevent a planning condition from prohibiting separate disposal.