News is emerging that HMRC”s appeal in the Atkinson case has been successful.
The First Tier Tax Tribunal decided last year in favour of a claim for Agricultural Property Relief on a farm bungalow. The property had been empty for some time – four years – because its occupier, a partner in the farming business, had gone to live in care.
The Upper Tier Tax Tribunal has now reviewed this decision and come to the opposite conclusion. The crux of the case seems to be the need to seek a sufficient connection between the use and occupation of the bungalow on the one hand, and the agricultural activity on the agricultural property over which relief from Inheritance Tax is claimed on the other. Do the facts give rise to a sufficient connection? In Atkinson the judges have decided it does not – the official report should be available soon, which should allow us to analyse this decision more closely.
Watch this space for further comment.