HMRC internal manual

Property Income Manual

PIM1054 - Income chargeable: disposal of waste on land

Where income arises from granting rights of tipping or other disposal of waste on land, it is derived from exploiting the owner’s proprietary interest in the land. It is therefore property income unless it represents a once and for all realisation of part of the capital value of the land.

In McClure v Petre [1988] 61TC226 sums received for permitting tipping of sub-soil on land were held to be capital receipts. This was essentially because of the Commissioners’ finding that there was no possibility of recurrence.

Lowe v J W Ashmore Ltd [1970] 46TC597, although concerned with the sale of turf, remains authority for the proposition that a receipt in consideration of the right to exploit one aspect of land is income where there is a possibility that such exploitation may again be possible in the future and that, accordingly, payments of the same nature may recur.

You should only accept that such sums are capital receipts if you are satisfied that there is no possibility of recurrence. If you are unable to reach agreement please make a submission to Business, Assets and International directorate (BAI). You should obtain and enclose with your file all the relevant facts and documentation. For further information regarding your submission please refer to the BAI Assets Residence and Valuation page.