Elson v. Prices Taylors, Ltd. (1962), 40 TC 671 (Ch. D.) -- summary under Timing

When a customer of the taxpayer ordered a "made-to-measure" suit he was asked for a deposit (although the receipt given to him showed only the purchase price and the balance owing, and did not use the word "deposit"). Ungoed-Thomas J. held that because "'deposit' bears a perfectly well and commonly known meaning of security for completion of the purchase" (p. 677) and because the payment was described as such to the customer, the payment should be regarded as a deposit and not merely a part-payment of the purchase price notwithstanding that senior employees of the taxpayer had been instructed that any customer who for any reason declined to take a suit he had ordered was to have his "deposit" refunded to him. He further held that because the deposit became the taxpayer's property on payment and any return of the deposit to the customer was made "not on account of any right of the customer to what was the Company's property, nor on account of any obligation under the contract, but because it was decided by the Company of its own volition, as a separate matter of policy, that it would be helpful to the Company's goodwill" (p. 678), the deposit was a trade receipt when received.