Too much mud

Was a vehicle ‘made available’ for private use?

The taxpayer bought a Land Rover Freelander as a commercial vehicle for her building business. She owned another car for private use.

HMRC disallowed input tax of £4 913 on the purchase of the Freelander and issued a £736 penalty. The taxpayer said the vehicle was ‘exclusively used for the purpose of her business’ and that it was ‘so dirty from business use that it was entirely unsuitable for private use’. The car was insured for business only and was never intended to be used by her or anyone else for private purposes.

The First-tier Tribunal decided that the taxpayer had ‘specifically arranged and maintained insurance cover which extends only to business use of the car’. The judge concluded that on the basis of the evidence as a whole the taxpayer ‘had no intention at the time she acquired...