John Clark (No. 2) v Commissioners for Her Majesty's Revenue and Customs
Decision date: 30 September 2010
Neutral citation: [2010] UKFTT 458 (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 apportionment of a VAT refund under the DIY housebuilders scheme after Mr Clark converted a garage/stable block into a dwelling. The Tribunal held apportionment must be by reference to the respective parts of the original building (not the completed building), that volume is the correct basis in principle but floor area is an acceptable proxy where it makes no material difference, and that roof space used for general storage remains part of the garage. The Tribunal allowed the appeal in part and fixed the refundable VAT at £4,747.37.
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
Apportionment of a residential conversion VAT refund is to be determined by reference to the status and parts of the original building; although volume is the proper metric in principle, floor area may be used as a justifiable proxy where building proportions mean it produces no material difference; roof space used for general storage ancillary to a garage remains part of the garage for apportionment purposes.
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 (by way of guidance) that ancillary storage should be treated as part of the original non-residential space, whereas genuinely independent non-residential uses (for example a separate office or hay loft) could take space outside the garage description. It also noted Tribunals should adopt a just and reasonable method of calculation taking building characteristics into account.