Restaurants consider court action over Revenue tronc guide

Restaurants under tronc investigation by the Inland Revenue (IR) could fight its decisions in court after sections of E24, the IR's latest tronc guide, were found to be potentially unlawful.

British Hospitality Association (BHA) chief executive Bob Cotton revealed last week that an "eminent" but unnamed QC had concluded some areas of the IR's new guidelines on the controversial "gourmet tax" were legally unsound.

The QC's findings mean restaurants under threat of fines for operating incorrect tronc schemes could contest decisions in court. Cotton said two restaurant businesses were considering the move.

He said: "We have discovered a difference of opinion which should be decided in court."

IR investigator Peter Davies warned, however, that the department's interpretation of the law was also corroborated by QCs and said anyone thinking of taking the IR to court would need "very deep pockets".

Steve Wright, Tronc expert at accountancy firm, Vantis, said there were elements of the guide he did not agree with but thought a High Court case could result in a loss of the tronc as a tax concession altogether.