Sportech receives ?93m VAT repayment from HMRC
London-listed firm could still have to repay the money pending a Supreme Court decision
Sportech has received a ?93m payment from Her Majesty’s Revenue & Customs (HMRC) after a long-running legal battle, the company announced this morning.
However, the firm also said it is awaiting a decision from the Supreme Court as to whether HMRC can appeal against the Court of Appeal’s unanimous decision in favour of Sportech.
If HMRC was granted the right to appeal (expected by autumn 2016), and the Supreme Court then overturned the decision, potentially late 2017 or early 2018, the money and any related interest would need to be repaid.
Sportech’s VAT claim, which was first submitted in 2009, centred on whether its ‘Spot the Ball’ competition was a game of chance or skill and therefore eligible for VAT payments between 1976 and 1996.
The First-tier Tribunal’s Tax Chamber ruled in 2013 it was indeed a game of chance and ordered HMRC to refund ?97m – a sum equal to half Sportech’s market cap – but the case has seen a litany of appeals since.
After its ?93m payment today, HMRC will pay the remaining ?4m following a “successful final determination”.
Sportech, which operates the Football Pools as well as providing tote equipment and software, saw shares up 5% to 58p on the London Stock Exchange this morning.