Dispute with taxman sees McLaughlin & Harvey rack up £2m bill

A dispute with the taxman saw McLaughlin & Harvey book a £2m provision in its last set of figures, accounts now filed at Companies House reveal.

The Northern Irish firm, which built the main stadium for last year’s Commonwealth Games in Birmingham and which recently won a £50m scheme to build a new learning campus in Wolverhampton, said the provision related to a “long-running legal case with Revenue Scotland on landfill tax”.

The row involves its environmental business with the firm making a provision of £1.95m after a partial award on the case was made in the taxman’s favour.

But in notes accompanying the accounts, filed just before Christmas, McLaughlin & Harvey said: “We contest this partial award and Revenue Scotland have appealed the Upper Tribunal ruling, so this will continue to run. All efforts are being made to resolve the issues in an amicable and sensible manner without further litigation.”

The contractor, which last month got the green light to start on a delayed £100m office scheme in Glasgow, said pre-tax profit in the 18 months to June 2022 was £3.2m, around £178,000 a month – down from the £5.9m, or £492,000 a month, it posted in the year to December 2021.Turnover was £799.5m, compared to £480m for the previous period.

It said its building and civils businesses stayed in profit with the firm landing spots on several government frameworks which it said meant “the current order book, tender opportunities and performance for 2022/23 are very healthy” – although it added supply chain delays, volatile pricing and labour restrictions meant it was forced to foot the bill for “substantial additional costs”.

But the firm’s environmental division racked up a pre-tax loss of £1.9m with McLaughlin & Harvey saying it was “downsizing and restructuring” the business as a result.

The accounts also show the firm claimed £113,000 from the government’s Coronavirus Job Retention Scheme during the period, on top of the £2.2m it picked up the year before.