Pertemps Recruitment Partnership Ltd v Commissioners for Her Majesty's Revenue and Customs
Decision date: 13 May 2010
Neutral citation: [2010] UKFTT 218 (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
Pertemps received customer overpayments made under a mistake, which it mixed into its single bank account and used for business expenses; it did not hold those payments on trust and treated them as its own money unless refunded. The First-tier Tribunal held those mistaken payments were receipts arising from Pertemps' trade and therefore taxable as trading profits; the appeal was dismissed.
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
Payments made by customers to a trader under a mistake can, where they are received into the trader's mixed trading bank account, treated as the trader's money and received in the course of trading (absent a fiduciary relationship), constitute trading receipts "arising or accruing" from the trade and be taxable as profits.
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 a customer's restitutionary claim is unlikely to be time‑barred until discovery of the mistake, leaving the recipient at ongoing risk of repayment, and suggested that earlier contrary authority (the Special Commissioners' Anise decision) should be confined to its facts.