Lok’nstore Group PLC v HMRC

In Lok’nstore Group PLC v HMRC (TC02266 – 26 September) a company (L) supplied taxable self-storage services from several buildings and also made some exempt supplies of insurance. It formed the opinion that the standard method of apportioning its input tax based on turnover did not attribute a sufficient proportion of the input tax incurred on its overheads to its taxable supplies. It applied for permission to use a special method of attributing its input tax which would be based on floor space and under which 99.98% of the input tax relating to its buildings would be attributed to its taxable supplies (rather than 94% under the standard method). HMRC rejected the application but the tribunal allowed L’s appeal. Judge Sinfield observed that L ‘uses the goods and services supplied to it in connection with the construction maintenance and operation of its stores almost exclusively...