selling public house

[TN]

The legislation doesn't say split for taper and then revisit the percentage for PPR. It says a proportion of the gain is covered by PPR, but then (nonsensically) you have to apportion the non-PPR element again between business and non-business.

What it should say is split the asset into two assets - the personal bit is reduced by PPR then the balance tapered at NBA rates, and the business bit reduced by BATR. But that's not what it says.

I've had a bit more of a search around, and found similar examples:

http://www.accountingweb.co.uk/cgi-bin/ ... =524&f=525
http://www.accountingweb.co.uk/cgi-bin/ ... ?id=163268

Both of these agree with the poster's accountant's analysis, and that the situation is bizarre but true.

[gpsangler]

Thanks to everyone for your advice and guidance.

Seems they've got you every which way............

Oh well........

Cheers and festive greetings to everyone.

Graeme

[TN]

I was reading about a recent case on this same subject, where the taxpayer argued and won that the (a) more beneficial and (b) more sensible calculation was the correct one to take. It may be worth looking at whether you are able to re-open your case with HMRC and reclaim the overpaid tax. I suspect that you are out of time, but it's worth checking. If you want me to have a look at it drop me an email - tristan.noyes@cta.org.uk.

[mullet]

The recent case that HMRC lost (Jefferies) on mixed use taper was, they say, down to the Tribunal's interpretation of "just and reasonable" in Sch A1. The Tribunal felt it just and reasonable to say that for a mixed use asset the balance of the gain remaining after the deduction of PRR must be solely business. HMRC don't see it like that - they say that the gain remaining arose through both business and non-business use of the whole, hence the need for apportionment for business and non-business taper.

Could a Section 33 claim be made? Probably not if the return was made in accordance with the practice prevailing at the time. The only hope is if this was a 2008-09 disposal, in which case an amendment can be made before 31-01-2011.