In Ventgrove Ltd v Kuehne+Nagel Ltd [2022] CSIH 40 (6 September 2022) the Inner House of the Court of Session (CSIH) held that a break payment made by a tenant to terminate a lease early was subject to VAT and that the landlord did not have a legitimate expectation that HMRC would not seek to impose the VAT charge.
Under the terms of a lease agreement entered into between Ventgrove Ltd the landlord and Kuehne+Nagel Ltd (KN) the tenant KN had the right to terminate the lease early following a minimum tie-in period provided it gave sufficient notice and paid Ventgrove £112 500 ‘together with any VAT properly due thereon’. Ventgrove had opted to tax the land. KN exercised its break right on 23 February 2021 and paid Ventgrove £112 500. Ventgrove contended that the break right had not been...
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In Ventgrove Ltd v Kuehne+Nagel Ltd [2022] CSIH 40 (6 September 2022) the Inner House of the Court of Session (CSIH) held that a break payment made by a tenant to terminate a lease early was subject to VAT and that the landlord did not have a legitimate expectation that HMRC would not seek to impose the VAT charge.
Under the terms of a lease agreement entered into between Ventgrove Ltd the landlord and Kuehne+Nagel Ltd (KN) the tenant KN had the right to terminate the lease early following a minimum tie-in period provided it gave sufficient notice and paid Ventgrove £112 500 ‘together with any VAT properly due thereon’. Ventgrove had opted to tax the land. KN exercised its break right on 23 February 2021 and paid Ventgrove £112 500. Ventgrove contended that the break right had not been...
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