Tax Avoidance – the lawful avoidance or reduction of tax by arranging one’s affairs in order to minimise the amount of tax payable

Exclusive occupation was not an issue in this case except insofar as MSSWL continued to occupy after the end of the lease. However as MPL took no steps to occupy, there was no competing occupation, although the judgement did consider the degree of control exercised by MPL

• Exclusive occupation was not an issue in this case except insofar as MSSWL continued to occupy after the end of the lease. However as MPL took no steps to occupy, there was no competing occupation, although the judgement did consider the degree of control exercised by MPL

• Transience was not an issue because the nature of the hereditament was not transient

The principles established in Furniss v Dawson [1984] STC 153 concerning a series of financial transactions are of no assistance in deciding whether a hereditament is occupied

• The principles established in Furniss v Dawson [1984] STC 153 concerning a series of financial transactions are of no assistance in deciding whether a hereditament is occupied

• See my article in March 2012 Valuer for more information on this

Chiltern District Council v Principled Partnership Ltd and Heathcote Distribution Ltd 2012

• Chiltern District Council v Principled Partnership Ltd and Heathcote Distribution Ltd 2012

• Magistrates’ Court – NOT a legal precedent

• Decision date 22 November 2012

• 19 separate office units at Chiltern Court, Ashridge Road, Chesham

• Empty rate 9 Sept. to 5 Nov. 2011

• Total rates £10,680

• Council billed empty rate for the period

• Ratepayers maintain they were occupied by storage boxes

Ratepayers provide short term storage facilities for companies

• Ratepayers provide short term storage facilities for companies

• Principle aim is to provide 6 week occupation of vacant premises in order to mitigate landlord’s rate liabilities

• Less than 10% of their income is derived from storage itself

• Most income derived from landlords

• Entitles to use premises and therefore liable

• Inspection by Council concluded that some boxes were empty and the rest contained items of no value – sham business – no meaningful occupation

Ratepayers maintain that they are a legitimate business providing bona fide storage solutions for companies requiring storage

• Ratepayers maintain that they are a legitimate business providing bona fide storage solutions for companies requiring storage

• All the units contained storage boxes provided by Atlas Supply Solutions Ltd – believed it to be confidential material

• Revenue from Atlas offset against transport costs

• Boxes contained items of value to clients of Atlas

• District Judge “benefit must derive to the occupier and not from the abatement of tax due”

Not practical for the Council to inspect all the boxes individually

• Not practical for the Council to inspect all the boxes individually

• Council only found some empty boxes and only inspected the contents of one box

• Evidence of ratepayers was largely un-contradicted

• Ratepayers did not hide the fact that their income was derived from the landlords

• Beneficial occupation – valid storage facilities on behalf of Atlas

• Not a sham company

• Very few boxes examined by Council

• Liability Order for empty rate refused – premises occupied

• Costs awarded against the Council £30,000

Sunderland City Council v Stirling Investment Properties LLP 2013

• Sunderland City Council v Stirling Investment Properties LLP 2013

• Decision dated 24 May 2013

• Stirling - freeholders of Unit G7, Phoenix Towers Business Park

• 1,500 m2 unit formerly part of a furniture warehouse

• Used by Complete Mobile Marketing Ltd (CMML) from 20/5/2011 to 1 July 2011 inclusive for blue tooth broadcasting

• Lease for 43 days for blue tooth marketing and advertising services - could be terminated at any time

• CMML billed and paid rates for 43 days

• Blue tooth box was 100 x 100 x 50mm

• Stirling liable for any rates from 2 July 2011

Stirling billed from 2 July 2011

• Stirling billed from 2 July 2011

• Stirling claimed entitlement to 6 months rate free period

• Application for a liability order dismissed

• Two questions for the High Court:-

• 1. Whether I erred in law in finding that the presence of the blue tooth apparatus constituted occupation of the hereditament?

• 2. Whether I erred in law in finding that the presence of the apparatus amounted to rateable occupation of the hereditament notwithstanding that it had been placed there for the purposes of advertising and not for warehousing?

Sunderland argued that the blue tooth equipment was “de minimis” and that it was not occupation as a warehouse

• Sunderland argued that the blue tooth equipment was “de minimis” and that it was not occupation as a warehouse

• Wilkie JJ concluded that although the rent was nominal, the rates were not and this surmounted the “de minimis” hurdle

•