The Football Association of Ireland (FAI) will receive a €700,000-plus windfall from the exchequer after the Revenue Commissioners conceded a court battle over the failed Eircom Park.
Centime Ltd, the company set up by the FAI to build and run the stadium, had claimed a refund in relation to around €680,000 of VAT arising on services.
The Revenue refused the refund on the basis that the stadium had never been built and because at the time the VAT-related expenses were incurred there had been no certainty the stadium would be built. In those circumstances, the Revenue inspectors claimed no refund was due.
However, Centime appealed this to the Revenue's appeals commissioners and won.
Revenue appealed again, this time to the High Court, which has also ruled in favour of the stadium management group on the basis of European case law. It ruled that the FAI's attempts through Centime to build the stadium, even though ultimately futile, were genuine. That was sufficient, it ruled, to entitle Centime to recover any VAT it paid.
Revenue has now decided not to appeal that ruling to the Supreme Court and will refund the outstanding VAT due together with interest on the sum that is outstanding since the collapse of the Eircom Park project in 2001.
Centime was established in 1998 after the FAI decided to build its own 45,000-seater stadium at an initial cost of €65 million. However, the Government decision to build a national stadium at Abbotstown cast the project into doubt as the projected cost of the FAI proposal nearly doubled.
In March 2001, the FAI abandoned the Eircom Park plan and agreed to support the Government proposal for Abbotstown, which itself collapsed subsequently.
Centime, which is still registered although it is not currently trading, features a cast of FAI heavyweights on its board, including former presidents Pat Quigley and Milo Corcoran as well former honorary secretary Des Casey, Shelbourne FC chairman Ollie Byrne and former chairman of the FAI sports ground committee Noel Kennedy.
Pascal Brennan, director of indirect tax at Deloitte, said the High Court judgment was welcome not just for Centime but for all start-up companies in property development.
Apart from confining Revenue to assessing that the venture had a genuine intent, regardless of its outcome, the High Court "clearly ruled" that there was nothing in the tax code that allowed Revenue "to impose rules such as a requirement for planning permission or a requirement to have an interest in the land" at issue when assessing eligibility to VAT refunds. Revenue had relied on both these points in its case and Mr Brennan said the court ruling on these issues was "probably of more concern" to the tax authorities than the outcome of this particular case.
