Punch gives guidance to tenants on HMRC machine tax rebates
Earlier this year, HMRC said it would be pursuing pub operators after a Court of Appeal decision reversed a High Court ruling from 2009 that led to hundreds of pub operators receiving tax rebates on overpaid VAT on gaming machine takings.
Punch has told tenants to inform the company when it receives a demand of payment from HMRC, promising that it will pay back its 50% share of the rebate as well as the interest on both shares, which is charged at 3% annually for the past two years.
It said the tenants will then need to arrange payments for the full amount with HMRC.
In a post on its Buying Club Website last week, the pubco said despite “prolonged discussions”, HMRC will not deal with it directly as the matter relates to individual pubs.
It added: “If you receive a letter from HMRC, please forward a copy of the letter to your credit assistant who will process our share of the credits onto your trade account and write to you with the necessary documentation.”
Concerns
Chris Lindesay, licensee of the Sun Inn in Dunsfold, Surrey and founder of the Punch Tenant Network, said he is concerned how licensees and ex-licensees will be able to afford to pay back the money, adding that 80% of Punch tenants earn less than £15,000 per year.
“We do not have machines so thank heaven are unaffected but I know very few tenants who would have had the resources to put the amount on one side for two years pending HMRC's appeal,” he said.
However, licensees may be repaid the refunds once more as casino operator Rank Group is appealing the most recent verdict, with a court hearing set for April.
Earlier this year, HMRC said it would be able to reach an alternative “mutually agreeable payment schedule” for those licensees in financial difficulty, although this would include additional interest charges.
