Capernwray Missionary Fellowship of Torchbearers v HMRC

In Capernwray Missionary Fellowship of Torchbearers v HMRC (TC03750 – 25 June 2014) the FTT held that a building was not used for a relevant residential or charitable purpose.

Capernwray is a charity whose object is to advance the Christian faith. It occupies a number of buildings in Lancashire close to both the Lake District and the Yorkshire Dales and offers residential conferences and courses. Capernwray charges for these but does not make a profit.

A building comprising dormitories and bedrooms as well as a large conference hall had been completed. Capernwray contended that the supply of construction services should be zero rated as a supply for a ‘relevant residential purpose’ or a ‘relevant charitable purpose’ (VATA 1994 Sch 8 Group 5).

If the building provided residential accommodation for students it would meet the ‘relevant residential purpose’ test. The FTT noted...