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

Wilkie JJ also concluded that there is nothing in the legislation which limits the ability of a local authority to levy rates to occupation for a purpose which is identical to the description of the hereditament in the rating list. The issue of any apparent disconnect between the nature of the occupation of an hereditament and its description in the rating list is a matter for the valuation officer.

Appeal dismissed – CMML were in occupation

and a further 6 months rate free applies

Letting to a charity only works if they occupy or intend to occupy it for charitable purposes (of that charity or that charity and others)

• Letting to a charity only works if they occupy or intend to occupy it for charitable purposes (of that charity or that charity and others)

• If there is no intention for the charity to use it for a charitable purpose, the charity will be liable for 100% charge

• If it is occupied, it must be wholly or mainly used for charitable purposes to qualify for mandatory relief

English Speaking Union Scottish Branches Educational Fund v City of Edinburgh Council 2009

• English Speaking Union Scottish Branches Educational Fund v City of Edinburgh Council 2009

• Judicial review of refusal of mandatory relief

• Tenants of whole building - 8 floors

• Only used the ground floor

• Ratepayer - wholly used for charitable purposes

• Council - only partially used

• Council’s argument is consistent with the ordinary meaning of the language used in the legislation

Kenya Aid Programme v Sheffield City Council 2013

• Kenya Aid Programme v Sheffield City Council 2013

• 2013 EWHC 54 (Admin)

• Appeal by case stated against liability orders for full charge

• Linked Judicial Review Claim

• Units 1 and 2 Europa Way Sheffield

• Total rates in dispute – over £1.6M

• Ratepayer is Kenya Aid Programme (KAP)

• KAP are a registered charity – not in dispute

• KAP in rateable occupation – not in dispute

• Main issue – are the premises wholly or mainly used for charitable purposes?

Both premises used for furniture storage

• Both premises used for furniture storage

• Furniture spaced out – more efficient approach to storage would compress the space to less than half the available space

• KAP also occupy various similar properties in the North East, the North and the North West

• The amount of furniture shipped to Kenya was small

• Low frequency of shipment

• KAP dependant on donations from Landlord to pay rates

• District Judge followed the approach in the Edinburgh case and decided that the premises were not wholly or mainly used for charitable purposes

In Glasgow Corporation v Johnstone [1965] AC 621 Lord Reid confined the analysis to the charitable purposes of the use made of the premises, not the extent of the use

• In Glasgow Corporation v Johnstone [1965] AC 621 Lord Reid confined the analysis to the charitable purposes of the use made of the premises, not the extent of the use

• In Kenya Aid case, Treacy LJ took the view that the Glasgow case did not prevent the court from applying the approach in the Edinburgh case

• It was right to consider the extent of use of the premises

• BUT the District Judge also took account of the inefficiency of the furniture storage and the necessity to occupy both premises

• These were irrelevant and should not have been taken into account, in the light of the Glasgow case

District Judge also took into account the “mutual advantages to the charity and the landlord”

• District Judge also took into account the “mutual advantages to the charity and the landlord”

• Treacy LJ said that if this referred to tax avoidance, it was not a matter to which weight should have been attached – Makro case referred to Gage v Wren [1903] 67 JP 32 in which Alverstone CJ stated that “if the ratepayer thought that she would not be within the charging act by going out of possession, she was quite entitled to do so”

• Alternatively if this referred to the use of the premises for fundraising, that would not be charitable in accordance with Oxfam v City of Birmingham District Council [1976] 1 AC 126

Treacy LJ – District Judge was right to take account of the extent of the use of the premises in line with the Edinburgh case

• Treacy LJ – District Judge was right to take account of the extent of the use of the premises in line with the Edinburgh case

• However District Judge also took account of irrelevant factors or factors that were not analysed sufficiently

• Hence District Judge’s decision was flawed because he took account of the efficiency of the storage and the need to occupy both premises contrary to the Glasgow case

• Appeal allowed and remitted back to the District Judge for further consideration

• The related application for Judicial Review was dismissed

• High Court decision on a case stated is final

• District Judge reconsidered the case and found that it

• was not wholly or mainly used for charitable purposes

•