Bank / Credit Union

ATM ruling returns $526M to UK retailers

photo provided by iStock

May 22, 2020

The U.K.'s Supreme Court unanimously ruled this week that external ATMs will not be subject to a separate business tax following the dismissal of a Valuation Office Agency appeal. With the loss of the appeal, retailers will receive £430m ($526 million) in rebates.

The VOA, which assesses property for taxation in England and Wales, challenged a 2018 Court of Appeal ruling that said internal or external ATMs at existing retail properties such as supermarkets or convenience stores should not be subject to separate taxation or rates bills, according to an article in the Retail Gazette. 

The VOA fought the ruling and continued to send out rate bills for over 15,000 ATMs in England and Wales from April 2010 until March 2019. Those funds will now be rebated to retailers, including any rates charged from March 2019 until present due to the ongoing litigation. In 2019, retailers withdrew 559 ATMs from their retail stores in an attempt to reduce their tax liability.

Bryan Johnston, UK head of real estate litigation at Dentons, the firm that acted for Sainsbury's, Sainsbury's Bank and The Co-op in the court case, said the court's ruling wasn't a victory just for retailers.

"It is also a significant victory for the public and their ability to access their own money through the ATM network," said Johnston. "If the court had allowed the appeal, many retailers would have had little choice but to reconsider the viability of offering free ATM services for the benefit of their customers. This could have had a negative impact on communities where an ATM in a shop is the primary method of accessing funds."