In J Nott v HMRC [2016] UKFTT 106 (18 February 2016) the FTT found that the taxpayer was deriving income from property and was not carrying on a trade.
Mr Nott had been gifted an estate comprising holiday accommodation units as well as a house rented out by Mr Nott and two cottages one of which was occupied by Mr Nott.
The issue was whether Mr Nott’s income from the estate was property income or trading income.
The FTT noted as the starting point that income derived from the exploitation of property was to be taxed as property income although the taxpayer may be able to establish that the activity did constitute a trade. It added that a property owner who gave up the occupation of his property in return for payment was very likely to be generating property income. Conversely a property owner who...
