HM Revenue & Customs (HMRC) is said to be taking an increasingly harsh line on many business claims, including an over-zelous tax treatment of pub group Wetherspoons’ toilet refurbishment scheme.

Wetherspoons had claimed it could offset some of the cost of renovating two of its pubs against its tax bill, using the current system of capital allowances, The Daily Telegraph reports.

Part of the pubs’ tax-deductible improvements were the partition dividers in its toilets and Wetherspoons argued these were additional and not part of the premises and therefore qualified as fixtures under the existing plant and machinery allowance rules.

HMRC disagreed. But a tribunal of special tax commissioners, having examined documents in seven ring binders and visited both pubs in question – Prince of Wales and the First Post – found in Wetherspoons' favour. However, an attempt by Wetherspoons to write down the cost of decorative panelling in the pubs was rejected.

Further reading:

Capital allowances legislation to hit business

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