To change a company’s accounting period, must be uncertain to Inspector. It is not an objective test. Citations: Ind Summary 19-Jun-1995 Statutes: Income and Corporation Taxes Act 1988 12-8 Jurisdiction: England and Wales Corporation Tax Updated: 21 January 2023; Ref: scu.82719
External Lloyds name does not get retirement annuity relief on underwriting profit. Citations: Ind Summary 15-May-1995 Statutes: Income and Corporation Taxes Act 1988 619-1 Jurisdiction: England and Wales Citing: Appeal from – Koenigsberger v Mellor (Inspector of Taxes) ChD 25-May-1993 Premiums which had been paid were not relevant earnings for annuity relief purposes. It was … Continue reading Koenigsberger v Mellor (Inspector of Taxes): CA 15 May 1995
SCIT INCOME TAX – Settlement – Company owned by husband and wife – Allotment of shares in company to their minor children on subscription at par – Payment of dividends to children – Whether settlement by virtue or in consequence of which dividends were paid within meaning of Income and Corporation Taxes Act 1988 ss. … Continue reading Bird and Another v Revenue and Customs: SCIT 3 Nov 2008
The taxpayer was obliged to visit an office in Leeds once a week. He lived in Norfolk. He sought to set off the travel expenses against his schedule E Income Tax. As a home worker, he also sought the expenses of maintaining an office at home. Both requirements were imposed by his employers as part … Continue reading Kirkwood (Inspector of Taxes) v Evans: ChD 25 Jan 2002
Amendments to employee share option schemes were due Inland revenue approval. Citations: Times 08-Aug-1995 Statutes: Income and Corporation Taxes Act 1988 135, 185 Jurisdiction: England and Wales Income Tax Updated: 20 December 2022; Ref: scu.82360
Anti-avoidance provisions do not catch a transfer of assets which were located abroad and which made at a time when the taxpayer was a non UK resident. Citations: Gazette 08-Mar-1995, Ind Summary 13-Feb-1995, Times 06-Jan-1995 Statutes: Income and Corporation Taxes Act 1988 739-741 Jurisdiction: England and Wales Citing: Appealed to – Inland Revenue Commissioners v … Continue reading Inland Revenue Commissioners v Willoughby and Another: CA 6 Jan 1995
No re-opening after closure notices The taxpayer had purchased software licences (SLA), and set out to claim the full cost against its tax liabiilities under the 2001 Act in the first year. The taxpayer said that after the Revenue had issued closure notices, it was not able to re-open the assessments for the year in … Continue reading Revenue and Customs v Tower MCashback Llp 1 and Another: SC 11 May 2011
Corporation Tax – group relief – claimant company resident in the United Kingdom – subsidiaries resident in other EU member states – whether making a claim for group relief implies the withdrawal of an earlier claim for group relief in respect of losses of companies resident in the United Kingdom – whether claim made in … Continue reading Linpac v Revenue and Customs (Income Tax/Corporation Tax : Exemptions and Reliefs): FTTTx 31 Jan 2020
The appellants were widowers whose wives had died at a time when the benefits a widow would have received were denied to widowers. The legislation had since changed but they variously sought compensation for the unpaid sums. Held: The appeal succeeded. By 1995 discrimination as to pensions was no longer supportable. And those appellants pursuing … Continue reading Hooper and Others, Regina (on the Application of) v Secretary of State for Work and Pensions: CA 18 Jun 2003
Cross loans were made between an investment company and pension schemes. The overall effect was to create payments which could be set off against Corporation Tax. They were not a pre-ordained series of transactions where the underlying loans were genuine, and the payments were made in respect of a genuine accrual of interest. Citations: Times … Continue reading McNiven (Inspector of Taxes) v Westmoreland Investments Ltd: CA 26 Oct 1998
The claimant sought damages from the revenue for their failure properly to process his claim for a sub-contractor’s certificate which had led to losses. Held: The revenue owed no common law duty of care to the claimant and nor were damages claimable under the section, and the claim failed. The Act imposed no statutory time … Continue reading Neil Martin Ltd v Revenue and Customs Commissioners: 28 Sep 2006
The company hired out cars, receiving advance payments. Such payments in respect of future accounting periods were brought forward as accruals. On the company’s sale the company was relieved of its obligations, but kept the accruals, and were charged to corporation tax on them as profits. For tax purposes the character of a payment was … Continue reading Tapemaze Ltd v Melluish (Inspector of Taxes): ChD 24 Feb 2000
Section 790 of the 1988 Act should be construed to accord with European law so far as necessary to allow for the grant of tax credits for foreign dividends. Judges: Henderson J Citations: [2013] EWHC 3249 (Ch), [2013] WLR(D) 411, [2013] BTC 751, [2014] 2 CMLR 10, [2014] STC 1236, [2013] STI 3391 Links: Bailii, … Continue reading The Prudential Assurance Company Ltd and Another v Revenue and Customs: ChD 24 Oct 2013
Citations: [2007] EWCA Civ 1041, [2008] Bus LR 663 Links: Bailii Statutes: Income and Corporation Taxes Act 1988 Part XIII Jurisdiction: England and Wales Taxes Management Updated: 19 November 2022; Ref: scu.260052
FTTTx INCOME TAX – loss relief – shares – s 574 ICTA 1988 – money held in director’s loan account – board resolution to allot shares – company secretary instructed to prepare and issue share certificate and to enter allotment in shareholders’ register – due to external circumstances, latter actions not taken – whether shares … Continue reading Saund v Revenue and Customs: FTTTx 3 Dec 2012
FTTTx CORPORATION TAX – Whether arrears of rent as between associated companies should be allowed on a bad debt, or disallowed for S74(1) ICTA 1988 – question of intention – Appeal Dismissed Citations: [2013] UKFTT 778 (TC) Links: Bailii Statutes: Income and Corporation Taxes Act 1988 74(1) Corporation Tax Updated: 17 November 2022; Ref: scu.472782
Life company’s management expenses were allowable against income under Sch D Case 1, but not allowable on income minus expenses basis. Citations: Times 24-Feb-1998, [1998] EWCA Civ 244 Statutes: Income and Corporation Taxes Act 1988 75 76 Jurisdiction: England and Wales Cited by: Cited – Camas Plc v HM Inspector of Taxes ChD 7-Jul-2003 An … Continue reading Prudential Assurance Company Limited v Johnson (HM Inspector of Taxes): CA 13 Feb 1998
The claimant sought to enforce a judgment debt against a foreign resident company, and for this purpose to examine or have examined a director who lived abroad. The defendant said that the rules gave no such power and they did, the power was outside the rule-maker’s power. Held: Even though the rule-making power is wide … Continue reading Masri v Consolidated Contractors International Co Sal and Others: HL 30 Jul 2009
FTTTx INCOME TAX – Seafarers’ earnings; ships; offshore installation; whether vessel offshore installation; Income Tax (Earnings and Pensions) Act 2003, Sections 378, 384 and 385. Income and Corporation Taxes Act 1988, Section 837C. Whether vessel ‘stationed’ – yes. Appeal dismissed. Citations: [2012] UKFTT 446 (TC) Links: Bailii Statutes: Income Tax (Earnings & Pensions) Act 2003 … Continue reading Graham Paterson Ltd and Another v Revenue and Customs: FTTTx 10 Jul 2012
FTTTx Corporation tax – deductibility of expenditure – sponsorship payments intended to improve fortunes of sports club – expectation of trade benefits principally as a result of recognition by others involved with the club of taxpayer’s benefaction – dual purpose of benefitting sports club and taxpayer’s trade – payments not deductible – direct promotion of … Continue reading Interfish Ltd v Revenue and Customs: FTTTx 4 Apr 2012
Appeal by the taxpayer from a decision of the Special Commissioners dismissing the taxpayer’s appeal against assessments to tax made in accordance with Section 747(4)(a) of the Income and Corporation Taxes Act 1988. Citations: [1997] EWCA Civ 2193, [1997] STC 1179, [1997] BTC 471 Links: Bailii Jurisdiction: England and Wales Corporation Tax Updated: 09 November … Continue reading Bricom Holdings Ltd v Commissioners of Inland Revenue: CA 25 Jul 1997
The taxpayer sought double taxation relief in respect of partnership profits earned in Jersey. Two sections appeared to be in direct contradiction. The earlier section had been superceded by the 1988 Act which was a consolidating Act. Consolidating legislation was intended to be read without reference to earlier legislation wherever possible save only in the … Continue reading Padmore v Inland Revenue Commissioners (No 2): ChD 8 Feb 2001
Wynchgate Construction Ltd, an associated company of the taxpayer company, (‘WCL’), commenced a trade in 1994 of providing the services of British construction workers to a contractor operating in Germany. The trade only lasted for about 5 months. WCL discontinued it in May 1994 but had not received payment, or ‘full payment’ for its services. … Continue reading Jowett (Inspector of Taxes) v O’Neill and Brennan Construction Ltd: ChD 25 Mar 1998
FTTTx Income tax – limited liability partnership acquired licence to film rights and sub-licensed rights to distributor – complex financing arrangements involving loans to members of the partnership and defeasance deposit by the distributor – whether partnership carrying on a trade (a precondition for members to claim relief for a prepayment of interest on their … Continue reading Eclipse Film Partners No 35 Llp v Revenue and Customs: FTTTx 20 Apr 2012
Arrangements in the Acts to allow the revenue authorities to protect their position where payments were to be made overseas, by requiring the withholding of amounts equivalent to the tax payable, went as far as the Act expressly allowed, and no further. There is a substantial gap in such provision. No direction was available where … Continue reading Pardoe (Inspector of Taxes) v Energy Power Development Corporation: ChD 2 Mar 2000
The court gave guidance on how an airline pilot whose earnings were in part obtained from services overseas should be taxed. The calculation should be made by calculating a ratio of earning days within the UK to those outside with a denominator of 365. Earnings for days when he was not working could not be … Continue reading Leonard v Blanchard (Inspector of Taxes): CA 16 Feb 1993
Commercial Practice is to be followed in apportioning payments under a lease between different tax years. There is no requirement that expenditure must be charged to year it in which technically falls due, but tax accounts must not give a misleading picture of trading results. Citations: Gazette 08-Sep-1993, Ind Summary 26-Jul-1993, Times 01-Jul-1993, [1994] Ch … Continue reading Gallagher v Jones (Inspector of Taxes) Threlfall v Same: CA 1 Jul 1993
Retired bank employees had previously received free tax advice. When the service was withdrawn, the bank made a payment. The Revenue said that this payment was chargeable to income tax. Held: The bank’s appeal failed. The payment was made ‘in connection with’ the former employment, and viewing that in context it was a chargeable payment … Continue reading Barclays Bank Plc and Another v HM Revenue and Customs: CA 11 May 2007
The taxpayer, a general surgical registrar, had a contract, requiring him to attend training courses and to obtain a specialist training certificate in order to qualify as a consultant surgeon. Clause 6 of his contract recorded that he had been issued with a National Training Number and clause 7 provided that his appointment was dependent … Continue reading Revenue and Customs Commissioners v Decadt: ChD 2008
FTTTx Income tax – charge on retirement benefits scheme administrator under s591C ICTA 88 on cessation of approval of scheme – whether notice validly given – whether assessments valid – whether raised in respect of correct year of assessment – whether raised in name of correct person – whether out of timeThe taxpayer appealed against … Continue reading John Mander Pension Trustees Ltd v Revenue and Customs: FTTTx 28 Oct 2011
The non-resident tennis player taxpayer appealed a charge to tax in respect of payments made for his sporting activities within the UK, made by overseas companies to other overseas companies owned by the taxpayer. Held: The Act provided that the activities of sportsmen were to be treated as trade payments, and any payment made in … Continue reading Agassi v S Robinson (HM Inspector of Taxes): ChD 17 Mar 2004
The company made available to certain employees discretionary annual bonuses which were paid instead by way of shares and received dividends. It now appealed against findings that the payments were taxable subject to Schedule F rates and were liable also to National Insurance. Held: Applying White, The court should not be seduced by the form … Continue reading HM Revenue and Customs v PA Holdings Ltd: CA 30 Nov 2011
The bank, based in Switzerland sought tax credits for the activities of its London branch. Held: Although the argument under s243 directly failed, the claim under section 788(3) had to succeed. The Swiss company was entitled to the same tax credits as would have been available to a UK corporation. Judges: Etherton J Citations: Times … Continue reading UBS Ag v HM Revenue and Customs: ChD 7 Feb 2006
Citations: [2005] EWHC 1558 (Ch) Links: Bailii Statutes: Taxes Management Act 1970 56(6), General Commissioners (Jurisdiction and Procedure) Rules 1994 20, Income and Corporation Taxes Act 1988 561(9) Jurisdiction: England and Wales Income Tax, Construction Updated: 25 September 2022; Ref: scu.228595
The taxpayer sought to set off against its liability to Corporation Tax the depreceiation of its stock. Held: The Inspector’s appeal succeeded. Even though the depreciation was conventional, the prohibition in the 1988 Act was general and overrode it, and was not displaced by the recognition given in the 1998 Act to standard accountancy practices. … Continue reading HM Inspector of Taxes v Mars UK Ltd: ChD 12 Apr 2005
The Court considered the interpretation of the sections which applied corporation tax to post-cessation receipts. Companies had received from the Inland Revenue substantial repayments of VAT together with interest. There had been reorganisations of the group, the company which had made the overpayment did not exist, and the payee of the repayment had only later … Continue reading Shop Direct Group v Revenue and Customs: SC 17 Feb 2016
The company sought to challenge the assessment to corporation tax of a very large repayment of VAT, together with an even larger amount of interest. Held: The appeal failed. Judges: Rimer, Briggs LJJ, Sir Stanley Burnton Citations: [2014] EWCA Civ 255 Links: Bailii Statutes: Income and Corporation Taxes Act 1988 103 106 Jurisdiction: England and … Continue reading Shop Direct Group v Revenue and Customs: CA 11 Mar 2014
FTTTx Income tax – employment income – whether receipt of shares was an emolument from employment within section 19 Income and Corporation Taxes Act 1988 – whether an obligation to deduct PAYE under sections 203F or 203B Income and Corporation Taxes Act 1988 Judges: Brannan TJ Citations: [2011] UKFTT 167 (TC) Links: Bailii Jurisdiction: England … Continue reading Rogers v Revenue and Customs: FTTTx 11 Mar 2011
Members of a partnership between them holding shares in a limited company, were not disqualified from claiming relief from tax under appropriate circumstances under the Business Expansion Scheme. Their separate interests were not to be aggregated because of the partnership. Citations: Times 08-Jun-1999, Gazette 09-Jun-1999 Statutes: Income and Corporation Taxes Act 1988 291 (1) Jurisdiction: … Continue reading Cook (Inspector of Taxes) v Billings and Related Appeals: ChD 8 Jun 1999
The novation of a debt to a company was a release incurring income tax liability. Citations: Gazette 16-Sep-1992 Statutes: Income and Corporation Taxes Act 1988 287-1 Jurisdiction: England and Wales Income Tax Updated: 13 September 2022; Ref: scu.79279
SCIT SHARE OPTIONS – unapproved scheme – gains by employee – whether charge to income tax arises when options exercised but shares not sold – yes – ICTA 1988 s 135(1). ASSESSMENT – power to raise assessment – whether loss of tax attributable to negligent conduct on the part of the Appellant or the person … Continue reading An Employee v Revenue and Customs: SCIT 19 Mar 2008
A scheme involving the use of offshore discretionary trusts resulting in the payment of funds to the directors of the company from which the payments originated was not effective to exclude such payments from liability to tax. Overall the scheme had the characteristics of artificiality allowing all but one steps to be disregarded. Nevertheless the … Continue reading D T E Financial Services Ltd v Wilson (Inspector of Taxes): ChD 9 Nov 1999
Income Tax – Settlor interested trust – Trust income consisting of payments made by settlor – Whether settlor is liable to tax on trust income by virtue of s 660A Income and Corporation Taxes Act 1988 – Yes Citations: [2012] UKFTT 49 (TC) Links: Bailii Jurisdiction: England and Wales Income Tax Updated: 03 September 2022; … Continue reading Rogge and Others v Revenue and Customs: FTTTx 12 Jan 2012
Judges: Lloyd LJ Citations: [2010] EWCA Civ 1538, [2010] STI 3244, [2011] STC 456, [2011] BTC 1 Links: Bailii Statutes: Income and Corporation Taxes Act 1988 144A, Income Tax (Earnings and Pensions Act) 2003 222 Jurisdiction: England and Wales Income Tax Updated: 31 August 2022; Ref: scu.427973
FTTTx Appeal against amended self assessment- whether payments of interest eligible for relief under section 353 Income and Corporation Taxes Act 1988 – whether a loan was used wholly and exclusively for the purposes of business under section 360 (1) (b) Income and Corporation Taxes Act 1988 Citations: [2010] UKFTT 441 (TC) Links: Bailii Statutes: … Continue reading Torkington v Revenue and Customs: FTTTx 17 Sep 2010
The taxpayer sought to include in the amounts to be set off by surrender against the group’s liability for corporation tax, chargeable gains in respect of allowable losses of a preceding accounting period. They appealed a decision against them at first instance. Held: The 1988 Act clearly did not allow amounts to be set off … Continue reading Taylor (Inspector of Taxes) v MEPC Holdings Ltd: CA 20 Jun 2002
An investment company made an abortive attempt to take over another. It sought to set off against its Corporation Tax, the costs of the professional advice incurred. Held: The expenses were deductible. Judges: Lord Justice Chadwick Vice-Chancellor, The Vice-Chancellor Lord Justice Carnwath Citations: [2004] EWCA Civ 541, Times 27-May-2004, Gazette 03-Jun-2004, [2004] BTC 190, [2004] … Continue reading Atkinson (HM Inspector of Taxes) v Camas Plc: CA 6 May 2004
When principal in group of companies relocated abroad, inter-group transfer of shares resulting was chargeable to corporation tax. Citations: Times 16-Mar-1998 Statutes: Income and Corporation Taxes Act 1988 278 Jurisdiction: England and Wales Corporation Tax Updated: 24 August 2022; Ref: scu.80172
A tax adjustment can be made by the Inland Revenue on an open assessment following transfer pricing enquiry and direction, even after many years. The court considered that the jurisdiction of the special and the general commissioners to determine such issues was exclusive: ‘It is not easy to discern any clear dividing-line between High Court … Continue reading Glaxo Group Ltd and Others v Inland Revenue Commissioners: ChD 21 Nov 1995
FTTTx Income Tax – Foreign Earnings deduction for Seafarers – Whether a vessel, accepted to be a ship on ordinary principles was an ‘offshore installation’ such that it was precluded from being classed as a ‘ship’, with the result that employees engaged on it were not entitled to the Foreign Earnings Deduction for Seafarers under … Continue reading Wright and Another v Revenue and Customs: FTTTx 11 Aug 2010
FTTTx Corporation tax – deductibility of expenditure – sponsorship payments intended to improve fortunes of sports club – expectation of trade benefits principally as a result of recognition by others involved with the club of taxpayer’s benefaction – dual purpose of benefitting sports club and taxpayer’s trade – payments not deductible – Income and Corporation … Continue reading Interfish Ltd v Revenue and Customs: FTTTx 13 May 2010
The taxpayer doctor had claimed against her income tax, the costs of attending training courses required under her employment contract and for professional development. The Revenue appealed against a decision allowing the expenses. Held: The court set out to reconcile the apparently conflicting decision in Decadt. Judges: Hooper, Rimer, Pitchford LJJ Citations: [2010] EWCA Civ … Continue reading HM Revenue and Customs v Banerjee: CA 28 Jul 2010
The taxpayer had sources of foreign income. Arrangements were made to take the benefit through the payment of interim dividends, which it intended to use to set off against liability for advance corporation tax. The Commissioner contended that these were a ‘transaction in securities’ Held: The payment of an interim dividend did fall within the … Continue reading Inland Revenue Commissioners v Laird Group plc: CA 30 Apr 2002
CORPORATION TAX – computation of profits – deductions – payments by Appellant before 2001 to employee benefit trust and after 2002 to family benefit trust – whether wholly and exclusively expended for the purposes of the Appellant’s trade – yes – whether Appellant’s profits computed in accordance with generally accepted accountancy practice – yes – … Continue reading Sempra Metals Ltd v Revenue and Customs: SCIT 7 Jul 2008
FTTTx Income Tax and NIC – Schedule E – emoluments/earnings – tax avoidance scheme – Remuneration Trust – employees’ individual sub-trusts – ‘protectors’ – (1) whether payments by employer into trust represent emoluments subject to PAYE and NIC; – (2) whether benefits (particularly loans) derived by employees from the Remuneration Trust represent emoluments subject to … Continue reading Murray Group Holdings and Others v Revenue and Customs: FTTTx 29 Oct 2012
The Court was asked whether an employee’s remuneration is taxable as his or her emoluments or earnings when it is paid to a third party in circumstances in which the employee had no prior entitlement to receive it himself or herself. Held: The company’s appeal failed. The purposive approach to the interpretation of the general … Continue reading RFC 2012 Plc (Formerly The Rangers Football Club Plc) v Advocate General for Scotland: SC 5 Jul 2017
Second Division Inner House) The AG appealed from a finding that a tax avoidance was not a sham. TH AG brought a new argument, that the payment of the sums to the remuneration trust involved a redirection of the employee’s earnings and accordingly did not exclude those earnings from the charge to income tax. Held: … Continue reading The Advocate General for Scotland v A Decision of The Upper Tribunal, Re Assessments To Tax Made On Murray Group Holdings Ltd and Others: SCS 4 Nov 2015
UTTC Income Tax and NIC – emoluments/earnings – tax avoidance scheme – remuneration trust – employees’ individual sub-trusts – ‘protectors’ – (1) whether payments into sub-trusts were emoluments/earnings subject to PAYE and NIC; -No (2) whether loans from sub-trusts were emoluments/earnings subject to PAYE and NIC; -No (3) ‘Ramsay’ principle – whether FTT erred in … Continue reading Revenue and Customs v Murray Group Holdings Ltd and Others: UTTC 8 Jul 2014
Inner House – The Court analysed the nature of the rights which a tax avoidance scheme, involving an offshore employee benefits trust and family benefit trusts and shares in Isle of Man companies, had conferred on the relevant employees. The employing company had accepted that the sums which it had paid though the employee benefits … Continue reading Aberdeen Asset Management Plc v HM Revenue and Customs: SCS 23 Oct 2013
Income Tax; emoluments; money’s worth; transfer of shares; readily convertible asset; Ramsay approach; tax avoidance scheme; Employee Benefit Trust; Discounted Options Scheme for employees in financial services industry; establishment of employee benefit trust; offshore companies established; money box company; family trust established; grant of option by offshore company in favour of family trust; transfer of … Continue reading Aberdeen Asset Management Plc v Revenue and Customs: FTTTx 29 Oct 2010
FTTTx DOUBLE TAXATION RELIEF – individual investor in Delaware LLC – whether entitled to the profits as they arise – yes – accordingly the Appellant is entitled to credit for US tax paid by him, the LLC being transparent for US tax purposes – if wrong, the LLC is not treated as transparent by s … Continue reading Swift v Revenue and Customs: FTTTx 22 Feb 2010
SXIT EMPLOYEE BENEFIT TRUST – whether deduction of contributions postponed until taxable as emoluments under FA 1989 s.43(11) – no – whether sub-funds in favour of directors who controlled the company taxable as emoluments on Ramsay principles or as a benefit in kind under TA 1988 s.154 – no — whether loans to directors taxable … Continue reading Dextra Accessories Ltd and others v Inspector of Taxes: SCIT 25 Jul 2002
Judges: Collins J Citations: [2008] EWHC 1511 (Admin) Links: Bailii Statutes: Income and Corporation Taxes Act 1988 232(3) Jurisdiction: England and Wales Income Tax, International Updated: 15 August 2022; Ref: scu.270621
Judges: Lord Neuberger MR, Longmore LJ, Smith LJ Citations: [2010] EWCA Civ 118 Links: Bailii Statutes: Taxation of Chargeable Gains Act 1992 286(5)(b), Income and Corporation Taxes Act 1988 416(2) Jurisdiction: England and Wales Capital Gains Tax Updated: 14 August 2022; Ref: scu.401793
First year’s trading relief for losses was ascribable to the year in which the occured not the basis period. Citations: Times 25-Oct-1996 Statutes: Income and Corporation Taxes Act 1988 38(1) Jurisdiction: England and Wales Income Tax Updated: 14 August 2022; Ref: scu.80763
Interest which was retained by a bank until closure of the account under a firm arrangement to that effect was not taxable as it accrued but only when it came to be due to be paid. Income did not normally arise until it was payable. Citations: Gazette 20-May-1998, Times 22-Apr-1998, [1998] 70 TC 682, [1998] … Continue reading Girvan (Inspector of Taxes) v Orange Personal Communications Services Ltd: ChD 3 Apr 1998
Losses which had been incurred in speculative non-commercial trading in shares and commodities were not ‘trade’ losses for income tax purposes, even though the tax payer intended to become involved in fund management as a career, and had intended these activities to be a commercially successful series. The taxpayer had claimed up to sixteen calls … Continue reading Wannell v Rothwell (Inspector of Taxes): ChD 29 Mar 1996
A payment made out of a pension scheme which had subsequently been found unlawful and ordered to be repaid, was not a taxable payment as such. The payment had been made in good faith and on advice. Citations: Times 13-May-1999, [1999] EWHC Admin 219 Links: Bailii Statutes: Income and Corporation Taxes Act 1988 601 Jurisdiction: … Continue reading Hillsdown Holdings Plc and HF Meat and Foods Processing Pension Scheme Trustees Limited v Commissioners of Inland Revenue: ChD 13 May 1999
An employee changing cars during the tax year has to make separate computations of benefit for each car. Citations: Times 14-May-1997, Gazette 21-May-1997 Statutes: Income and Corporation Taxes Act 1988 157 sch 6 Jurisdiction: England and Wales Income Tax Updated: 05 August 2022; Ref: scu.81328
SCIT DOUBLE TAXATION RELIEF – effect of s 795A Taxes Act 1988 – whether the reasonable steps include entering into a different transaction – no – appeal allowed Citations: [2009] UKSPC SPC00738, [2009] STI 695, 11 ITL Rep 734, [2009] STC (SCD) 315 Links: Bailii Statutes: Income and Corporation Taxes Act 1988 795A Income Tax … Continue reading Hill Samuel Investments Ltd v Revenue and Customs: SCIT 20 Feb 2009
FTTTx Income tax – pension payable to husband – claim that half of pension should be assessed on wife – Income and Corporation Taxes Act 1988 sections 1 and 19, Schedule E paragraph 2 – Income Tax (Earnings and Pensions) Act 2003 sections 569, 571 and 572 – Matrimonial Causes Act 1973 sections 21A and … Continue reading Rockliff v Revenue and Customs: FTTTx 25 Jun 2009
FTTTx Seafarers’ earnings; ship; offshore installation; whether vessels offshore installations; Mineral Workings (Offshore Installations) Act 1971 sections 1 and 12; Income and Corporation Taxes Act 1988 section 192A, 837C; Income Tax (Earnings and Pensions) Act 2003 sections 378-385; Offshore Installations and Pipeline Works (Management and Administration) Regulations 1995, regulation 3(1)(a)(c)and(d) and (2)(d)and(e) Citations: [2009] UKFTT … Continue reading Spowage and Others v Revenue and Customs: FTTTx 18 Jun 2009
To avoid a restriction unlawful under European law of a company’s freedom of establishment in the context of the profits of a foreign controlled company and that company’s right of freedom of establishment, the court could properly read into the 1988 Act an additional exception.Sir Andrew Morritt, C quoted counsel in setting out the principles … Continue reading Vodafone 2 v HM Revenue and Customs: CA 22 May 2009
UK companies were subsidiaries of companies resident abroad, and complained that they were unable to make group income elections. Held: The prohibition infringed non-discrimination provisions of double taxation agreements – non-discrimination provisions had not been given effect in domestic law in respect of advance corporation tax. It did not greatly matter whether the High Court … Continue reading NEC Semi-Conductors Limited and Other Test Claimants v The Commissioners of Inland Revenue: ChD 24 Nov 2003
The taxpayer company had been refused a statutory Construction Industry Scheme certificate. The General Commissioners allowed the company’s appeal and itself issued a certificate. The revenue said the Commissioners had no jurisdiction either to hear an appeal or to issue such a certificate. Held: The scheme created by the 1971 Act was a special one. … Continue reading Tom Hudson (HM Inspector of Taxes) v JDC Services Limited: ChD 26 Mar 2004
The court considered whether the taxpayer, a BA airline pilot, was resident or ordinarily resident in the UK. Judges: Lewison J Citations: [2008] EWHC 2708 (Ch), [2008] BTC 843, [2008] STI 2503, [2009] STC 213 Links: Bailii Statutes: Income and Corporation Taxes Act 1988 19(1) Jurisdiction: England and Wales Income Tax Updated: 21 July 2022; … Continue reading Revenue and Customs v Grace: ChD 11 Nov 2008
SCIT SETTLEMENT – Dividend waiver – Income arising under a settlement in which settlor retains interest – Arrangement – Company owned by husband and as to one share by wife – Husband waived dividend in relation to all his 9999 shares – Enhanced dividend consequently paid to wife in respect of her one share – … Continue reading Buck v Revenue and Customs: SCIT 23 Oct 2008
The taxpayer entered into a scheme for the issue and disposal of corporate loans. He appealed a finding that the loans were caught by section 115 which disallowed exemption because they did not represent a normal commercial loan. Held: It was a requirement that the debt ‘has at all times represented a normal commercial loan’, … Continue reading Weston v Garnett (Inspector of Taxes): ChD 25 Jun 2004
The Revenue had published a booklet, IR20, setting out their approach to the interpretation of the phrases ‘residence’ and ‘ordinary residence’. The taxpayer said that this was a more generous definition than the statutory one, and that having acted on it he had a legitimate expectation that the booklet’s interpretation would continue to be applied. … Continue reading Davies and Another, Regina (on The Application of) v Revenue and Customs: SC 19 Oct 2011
The taxpayer appealed against a finding that the value of shares in quoted companies transferred into his unapproved funded retirement benefits scheme by the employer was payment of a sum under section 595 and was taxable as such. Held: The appeal failed. The words ‘pays a sum’ were not restricted to payments of cash. To … Continue reading Irving v Revenue and Customs: ChD 8 Feb 2007
The husband and wife had each owned a share in a company which sold the services of the husband. The Revenue claimed that the payment of dividends to the wife was a settlement. Held: The Revenue failed. The share had been transferred to the wife by the formation agents. The share carried more than the … Continue reading Jones v Garnett (Her Majesty’s Inspector of Taxes): HL 25 Jul 2007
SCIT CAPITAL GAINS TAX – tax avoidance scheme – whether subscription for shares followed by the return of the subscription money by way of dividend (by an unlimited company), followed by disposal of the shares for a nominal amount five months after the subscription was a self-cancelling composite transaction – yes – whether HMRC can … Continue reading Eyretel Unapproved Pension Scheme and others v Revenue and Customs: SCIT 12 Nov 2008
The Revenue appealed findings as to the calculation of profits for corporation tax. The companies had sought to deduct sums from profits for depreciation of unsold stock in accordance with current accounting standards. Held: ‘the profit and loss account is concerned with revenue and expenses. A fall in the value of stock to below cost, … Continue reading Revenue and Customs v William Grant and Sons Distillers Ltd: HL 28 Mar 2007
The court was asked whether termination payments made to employees on redundancy and which had been calculated according to unexpired notice periods were liable to Schedule E income tax and national insurance. The calculations were based upon a memorandum of agreement between the company and the trades union. Held: The memorandum could not sensibly be … Continue reading SCA Packaging Ltd v HM Customs and Excise: ChD 22 Feb 2007
The court considered the treatment of losses in a London branch of the non-resident Bank. Had the company been resident it could have set off the losses. It claimed that the refusal was an unlawful discrimination. Judges: Sedley, Arden, Moses LJJ Citations: [2007] EWCA Civ 119 Links: Bailii Statutes: UK-Switzerland Double Taxation Convention of 8 … Continue reading HM Revenue and Customs v UBS Ag: CA 21 Feb 2007
Appeal against refusal of Construction Industry Scheme Certificate. Citations: [2007] EWHC 73 (Ch) Links: Bailii Statutes: Income and Corporation Taxes Act 1988 561 Jurisdiction: England and Wales Income Tax, Construction Updated: 09 July 2022; Ref: scu.248325
The defendants suspected a carousel VAT fraud. The defendants appealed a finding that there was a viable cause of action alleging a ‘conspiracy where the unlawful means alleged is a common law offence of cheating the public revenue’. The defendants argued (inter alia) that the attempted recovery was void under the Billl of Rights. Held: … Continue reading Total Network Sl v Customs and Excise Commissioners: CA 31 Jan 2007
The taxpayer made arrangement for the sale of securities in the form of loan notes with accrued income. It appealed a decision denying to the arrangement treatment of the full sum as capital. Held: The appeal failed. The agreements provided for irregular repayments, they did so with an apparent standard interest rate. The agreements fell … Continue reading Cadbury Schweppes Plc and Another v Williams (Her Majesty’s Inspector of Taxes): CA 24 May 2006
The contractor sought an exemption certificate. The revenue refused it saying that he had failed to make the appropriate returns, and now appealed the General Comissioners’ decision to issue one. Held: This was not a situation where there was any discretion. The section was rigorously prescriptive save only where a failure was ‘minor and technical’. … Continue reading Revenue and Customs v Facilities and Maintenance Engineering Ltd: ChD 30 Mar 2006
Under s247 of the 1988 Act, a company paying dividends to a parent company need not withhold ACT. This option was not offered where either subsidiary or parent was not UK resident until the decision in Hoechst which found the restriction contrary to European law. The Revenue now appealed a decision allowing recovery of the … Continue reading Pirelli Cable Holding Nv and others v Inland Revenue: HL 8 Feb 2006
The claimant companies had paid corporation tax under rules which had later been found to be discriminatory. They now sought repayment by virtue of double taxation agreements with the countries in which the parent companies were based. Held: The double agreements required the taxation provisions should not treat worse ‘other similar enterprises of that first-mentioned … Continue reading Boake Allen Ltd and others v HM Revenue and Customs: CA 31 Jan 2006
Husband and wife had been shareholders in a company, the wife being recorded as company secretary. The company paid dividenceds to both. The husband appealed a decision that the payment to his wife was by way of a settlement and was taxable in his hands. Held: The appeal succeeded. ‘there can be no doubt but … Continue reading Jones v Michael Vincent Garnett (HM Inspector of Taxes): CA 15 Dec 2005
Judges: The Honourable Mr Justice Etherton Citations: [2005] EWHC 1610 (Ch), [2006] STC 210 Links: Bailii Statutes: Income and Corporation Taxes Act 1988 717 Jurisdiction: England and Wales Cited by: Appeal from – Cadbury Schweppes Plc and Another v Williams (Her Majesty’s Inspector of Taxes) CA 24-May-2006 The taxpayer made arrangement for the sale of … Continue reading Cadbury Schweppes Plc and Another v Williams (HM Inspector of Taxes): ChD 21 Jul 2005
The taxpayer, a barrister had paid into both a retirement annuity contract and into a personal pension scheme. She sought to be able to claim full tax relief on all payments. Held: The two payments were to be aggregated, and only any excess of the combined payments carried forward. Though this might be unfair, this … Continue reading Lonsdale v HM Inspector of Taxes: CA 17 Jun 2005
SCIT CORPORATION TAX – Appellant issued funding bonds to foreign subsidiary companies – whether the effect of section 582 of the Income and Corporation Taxes Act 1988 was to treat the funding bonds as interest and therefore as income with the result that the foreign exchange legislation in the Finance Act 1993 did not apply … Continue reading Finance Ltd v HM Inspector of Taxes: SCIT 25 Jan 2005
The section gave the Commissioners a discretion as to whether to certify an otherwise complying policy of life assurance under the Act, so as to allow tax relief on premiums. No mandatory duty to approve policies was set out. Judges: Lord Justice Pill, Lord Justice Robert Walker and Mr Justice Laddie Citations: Times 26-Nov-2001, [2001] … Continue reading Monarch Assurance plc v Inland Revenue Commissioners: CA 9 Nov 2001
The taxpayer worked as an information technology specialist. His earnings were channelled through a limited company. The company paid on part of its income to his wife, with the result that the total tax paid was reduced. The inspector sought to tax the sum paid to the taxpayer’s wife as a settlement made on her … Continue reading Jones v Garnett (Inspector of Taxes): ChD 28 Apr 2005
SCIT Income Tax – Schedule E – Benefit in kind – Whether expenses paid by company assessable as income of director – Apportionment of expenses – Income and Corporation Taxes Act 1988 ss.154, 156 – Discovery Assessment – Taxes Management Act 1970, Section 29 Citations: [2004] UKSC SPC00450 Links: Bailii Statutes: Income and Corporation Taxes … Continue reading Xi Software Ltd v HM Inspector of Taxes: SCIT 3 Dec 2004
The claim against the defendant at the tribunal had been settled by a compromise which had then been the subject of an order by the tribunal. The Revenue sought to charge the payment to income tax. Held: It had been paid ‘in connection with’ the termination of his employment, was less than pounds 30,000 and … Continue reading Wilson (HM Inspector of Taxes) v Clayton: CA 7 Dec 2004
The contractor had not met its liabilities to pay PAYE. The general commissioners had nevertheless granted a construction industry certificate under sections 561 and 565, having found an informal agreement to allow late payments. Held: No tax was now outstanding. The taxpayer had a turnover of andpound;5 million a year, but would be bankrupt without … Continue reading Templeton (Inspector of Taxes) v Transform Shop Office and Bar Fitters Ltd: ChD 15 Jul 2005
