Greene King has confirmed it will take its long-running fight with HMRC over a £21m tax planning scheme, known as Project Sussex, to the Court of Appeal.
In its latest annual report, the brewery and pub group revealed plans to resume the legal battle, though the accounts show it has now made a financial provision to cover a potential defeat.
The first tier tax tribunal first rejected the tax avoidance case back in 2012 and earlier this April the upper tribunal came to the same conclusion.
The group said the case was complex and the later UT decision was unclear on certain elements of the case.
Following the UT tribunal ruling, Treasury minister David Gauke welcomed the decision against the brewer: “The vast majority of taxpayers play by the rules and the government will continue to take action to tackle the minority who seek to avoid their responsibilities. Anyone who gets involved in tax avoidance schemes is playing with fire.”
However the group, famous beer brands like for Old Speckled Hen and Abbot Ale, has now asked for clarification from the Court of Appeal.
Greene King confirmed: “We have been advised that the upper tribunal decision was unclear on certain elements of the case and, therefore, it will now be considered by the court of appeal.”
The tax scheme, which was sold to the group by EY, involved a £300m internal loan between Greene King plc and another member of the same group, Greene King Acquisitions.
In the UT the Revenue argued that the scheme involved artificial transactions.
Greene King has since defended its tax record, saying: “Greene King has been paying its taxes for 215 years and we are a major contributor to the Treasury with a third of our turnover, or £400m, paid to HMRC in various forms of tax, in the last year alone. This is seven times what we pay to our shareholders in dividends.
“Over and above this, we occasionally take specific tax advice from experts, such as EY in this case, about other areas of potential tax paid by Greene King. In this complex case, we have been advised that the Upper Tribunal decision was unclear on certain elements of the case and therefore, it will now be considered by the Court of Appeal.”