Alexandra Countryside Investments Ltd v HMRC

In Alexandra Countryside Investments Ltd v HMRC (TC02751 – 21 June) a company converted a public house into two semi-detached houses. It reclaimed input tax on the work. HMRC rejected the claim on the basis that before the work part of the public house had been used as a flat for a manager so that the work failed to qualify for zero-rating. The First-tier Tribunal allowed the company’s appeal against this decision applying the CA decision in C&E Commrs v I Jacobs CA [2005] STC 1518 and declining to follow the VAT Tribunal decision in Calam Vale Ltd (VTD 16869). Judge Kempster held that ‘the fact that an additional dwelling has been created means that Note 9 does not prevent the conversion coming within Item 1(b)’. He also held that there was no justification for distinguishing between claims under s 35 (such as...