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Marites Salabit (TC7450)
The taxpayer was asked to operate the bar at her local church. She and her mother were both active members of the church. A contract was agreed between the taxpayer and the church in February 2013 with the following terms and conditions:
- she paid rent of £625 a week to the church – this was a fixed cost and payable irrespective of how much money the bar took (this was later reduced to £500 a week because the bar was not profitable);
- she was responsible for staff costs paying suppliers and also paying and arranging for TV licences and Sky TV;
- she was responsible for rates and insurance overheads although the church helped by paying some of these bills; and
- she could retain any profits - bar takings (cash and card) were banked into her personal bank account rather than a church account.
HMRC became aware of the arrangement. It...
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