A BLUNDER by the taxman more than a decade ago has led to an unexpected boost for under-review leisure services in Rossendale.

Council bosses are set to take delivery of a £661,000 rebate from Her Majesty’s Revenues and Customs (HMRC) over VAT which was incorrectly charged on leisure centre services in the 1990s.

And because the income was lost to leisure services, councillors have agreed to safeguard the windfall pending the outcome of the borough’s sports centres review.

With the cost of a replacement pool estimated at around £4million, and the future of Ski Rossendale and Bacup Leisure Hall in the balance, the money could not have come at a more opportune moment.

Another two outstanding VAT claims for leisure centre coaching services, still being processed by the revenues service and also thought to be worth thousands of pounds, could provide further boosts later in the year.

Auditors from PriceWaterhouseCoopers have been working on Rossendale Council’s claims.

The successful claim particularly relates to income received by Rossendale Council, which managed the service before it was taken over by Rossendale Leisure Trust, for swimming pools.

Coun Jason Gledhill, leisure cabinet member, said: “The result of this is that we have received more than £600,000, which is very welcome.

“The leader of the council, Tony Swain, has agreed that we can ring-fence this money so it can contribute towards the outcome of the leisure review.”

The VAT claim made by Rossendale follows the outcome of a test case by Aston Martin dealer Bodycraft.

Bosses there claimed they should be allowed to recoup VAT wrongly charged to the firm in the 1990s.

Tax officials claimed there should be a three-year limitation on repayments but lost a lengthy legal battle on the issue.