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Court of Appeal takes narrow approach to Business Premises Renovation Allowance (London Luton BPRA v HMRC)

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Published on: 05 May 2023

Published by a LexisNexis Tax expert

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Article summary

Tax analysis: James Le Gallais and Anastasia Nourescu of Stewarts review the first Court of Appeal judgment to consider the application of the Business Premises Renovation Allowance (BPRA) on the conversion of a flight training centre near London Luton Airport into a hotel. The court found in favour of HMRC, construing the scope of the allowance narrowly and limiting the types of expenditure that qualify for BPRA. The decision will impact several open HMRC enquiries on BPRA and will also be relevant to other capital allowances that turn on whether expenditure was incurred for a particular purpose. HMRC is paying close attention to tax relief claims more generally, and it remains to be seen whether it will seek to rely on this judgment to take a more restrictive approach to such claims.

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