WELCOME REFUND FOR RANK PLC
14 November 2008
Five-and-a-half years of VAT comes back to the
company
The British online and land gambling group Rank plc
received a welcome financial boost totalling GBP 59.1
million this week, courtesy of Her Majesty's Revenue and
Customs. The refund was in respect of overpaid VAT over
a period of five-and-a-half years between January 2003
and June 2008, and has been returned to Rank following a
VAT and Duties Tribunal ruling made in May this year,
which Her Majesty's Revenue and Customs has appealed.
Rank anticipates the net cash benefit to be partially
offset by gross profits tax and other related costs. The
company said that the HMRC appeal would be heard by the
High Court in the first half of 2009. If Her Majesty's
Revenue and Customs is successful in its appeal, Rank
may be required to return the payment with interest.
The case concerns the application of VAT on games of
interval bingo in Rank's Mecca Bingo clubs. As a
consequence of the Tribunal's ruling, Mecca Bingo has
not paid VAT on any games of interval bingo since July
2008.
Rank Group does not at present intend to recognise the
revenue or operating profit benefits of the repayment in
the group accounts for 2008. The repayment will be used
to reduce the group's net debt and will have no impact
on the size of Rank's existing banking facilities, which
will remain committed until 2012, said a company
spokesman.
The Tribunal's ruling is expected to result in an
annualised cash benefit to Rank of around GBP 6 million.
Online Casino News courtesy of
InfoPowa
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