Works on a building comprised a conversion

Between January 2016 and September 2016 the taxpayer carried out building works on a disused retail warehouse that had formerly been used as a furniture store for a cost of about £1.675m. The warehouse was transformed into a car showroom and workshop.

The taxpayer claimed business premises renovation allowances (BPRA) on the basis that the expenditure was incurred on the conversion or renovation of the warehouse. HMRC denied the claim. The taxpayer appealed.

The First-tier Tribunal said the appeal hinged on a single issue – the statutory meaning of the word ‘conversion’ and whether the works answered to that description. The judge said there was no specific statutory meaning of conversion so it was necessary to start with its ordinary meaning. The judge accepted the taxpayer’s view that as ‘a matter of straightforward language “conversion” does require a continuity of identity between the old building and...