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Is asparagus growing business market gardening or farming?

In 2004 the taxpayer began trading as a horse breeder. Four years later she began a new trade of asparagus farming which she anticipated would return substantial profits although it would be three years before the first crop was harvested.

In her 2008-09 self-assessment tax return she claimed sideways loss relief under ITA 2007 s 64(1) and (2) for her equestrian and asparagus businesses.

HMRC refused the claim. The taxpayer appealed. The First-tier Tribunal dismissed her appeal saying that the taxpayer was operating two ventures as a single trade but although the asparagus element was run on a commercial basis the horse breeding one was not.

The Upper Tribunal said the First-tier Tribunal had made an error in law in saying there was a single trade. It was therefore necessary to consider whether the asparagus business...