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HMRC internal manual

Business Income Manual

Cemeteries and crematoria: lump sums/graves maintenance

Receipts taxable when they arise - but allow a properly computed provision for future maintenance

Where cemetery receipts include lump sums under contract to maintain in perpetuity the repair of the graves and monuments and/or the decoration of the graves, you should regard such sums as trading receipts.

However, you should allow a properly computed (see BIM46500) provision for the estimated future expenditure on the maintenance, repair and decoration of the graves and monuments (see London Cemetery Co Ltd v Barnes [1917] 7 TC 92).

For guidance on what this means in practice, see BIM52510.