Category: Corporation Tax

Countrywide Estate Agents FS Ltd v The Commissioners For Revenue and Customs: FTTTx 11 Jun 2010

Corporation Tax – Capital or income – lump sum receipt – taxpayer a financial intermediary – taxpayer enters into exclusivity agreement with life insurance provider – life insurance provider agrees to pay lump sum in advance plus commission on sales following successful introductions from taxpayer – whether lump sum of capital nature – no – appeal dismissed

Citations:

[2010] UKFTT 263 (TC)

Links:

Bailii

Jurisdiction:

England and Wales

Corporation Tax

Updated: 11 October 2022; Ref: scu.422264

Legal and General Assurance Society Ltd v Revenue and Customs: FTTTx 6 Aug 2009

CORPORATION TAX – insurance company – with-profits policyholders sharing in profits of with-profits policies only – which revenue accounts are ‘required to be prepared’ for the purposes of FA 1989 s 83A(2)(b)? – not the memorandum Form 40 in respect of the with-profits part of the Life and Annuity fund

Citations:

[2009] UKFTT 225 (TC), [2009] STI 2748, [2009] SFTD 701

Links:

Bailii

Jurisdiction:

England and Wales

Corporation Tax

Updated: 05 October 2022; Ref: scu.409026

Parnalls Solicitors Ltd v The Commissioners for Revenue and Customs: FTTTx 10 Nov 2009

Corporation tax – lump sum paid for release of annuity – deductible expense – obligation to pay annuity assumed on transfer of partnership business – whether revenue or capital

Citations:

[2009] UKFTT 318 (TC), [2010] SFTD 284, [2010] STI 378

Links:

Bailii

Jurisdiction:

England and Wales

Corporation Tax

Updated: 05 October 2022; Ref: scu.409116

Market South West (Holdings) Ltd v Revenue and Customs: FTTTx 17 Mar 2010

FTTTx CORPORATION TAX – EXPENDITURE OF REVENUE OR CAPITAL NATURE – LEGAL FEES RELATING TO DISPUTED PLANNING APPLICATION Appellants incurring professional fees in dispute relating to planning permissions – did expenditure relate to capital asset – yes – did expenditure relate to maintenance of existing capital asset – no – did expenditure relate to acquisition or extension of existing capital asset – yes – did recurrent nature of fees charged imply Revenue expense – no – did unsuccessful outcome of planning appeal impact tax treatment of expenditure – no – Appeal Dismissed.

Citations:

[2010] UKFTT 121 (TC)

Links:

Bailii

Jurisdiction:

England and Wales

Corporation Tax

Updated: 04 October 2022; Ref: scu.408965

Franked Investment Income Group Litigation, The Test Claimants In v Revenue and Customs: CA 24 Nov 2016

Judges:

Sir Geoffrey Charles Vos Ch, Underhill, David Richards LJJ

Citations:

[2016] EWCA Civ 1180, [2017] STC 696, [2016] BTC 44, [2017] 1 CMLR 37

Links:

Bailii

Statutes:

Value Added Tax Act 1994 94

Jurisdiction:

England and Wales

Citing:

At ChD – The Test Claimants In The FII Group Litigation v The Commissioners of Inland Revenue and Another ChD 14-Oct-2015
. .
Lists of cited by and citing cases may be incomplete.

Corporation Tax, Damages

Updated: 04 October 2022; Ref: scu.571930

Test Claimants In The FII Group Litigation v Commissioners of Inland Revenue: ECJ 5 Sep 2013

ECJ Opinion – Recovery of national taxes which are contrary to European Union law – Limitation period for instituting proceedings – National legislation curtailing the limitation period with retroactive effect and without advance notice

Judges:

Wathelet AG

Citations:

C-362/12, [2013] EUECJ C-362/12

Links:

Bailii

Jurisdiction:

European

Citing:

See Also – Test Claimants In The FII Group Litigation v CIR ECJ 12-Dec-2006
ECJ (Opinion of Geelhoed AG) Interpretation of Articles 43 and 56 EC and Articles 4(1) and 6 of Council Directive 90/435/EEC of 23 July 1990 on the common system of taxation applicable in the case of parent . .
See Also – Test Claimants In the FII Group Litigation v HM Revenue and Customs ChD 27-Nov-2008
The claimants were companies with parent companies in the UK and other subsidiaries not so resident, both in the EU and outside. They complained of the differences in treatment under corporation tax of the payment of dividends between the . .
See Also – Test Claimants In The FII Group Litigation v The Commissioners For Her Majesty’s Revenue and Customs ECJ 19-Jul-2012
ECJ Articles 49 TFEU and 63 TFEU – Payment of dividends – Corporation tax – Case C-446/04 – Test Claimants in the FII Group Litigation – Interpretation of the judgment – Prevention of economic double taxation – . .

Cited by:

See Also – Test Claimants In The FII Group Litigation v Commissioners of Inland Revenue ECJ 12-Dec-2013
ECJ Judicial protection – Principle of effectiveness – Principles of legal certainty and the protection of legitimate expectations – Restitution of sums paid but not due – Remedies – National legislation – . .
See Also – The Test Claimants In The FII Group Litigation v HM Revenue and Customs ChD 18-Dec-2014
The company claimants had paid large sums in excess tax under a mistake of European law. . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax

Updated: 04 October 2022; Ref: scu.515170

Hamilton and Kinneil (Archerfield) Ltd and Others v Revenue and Customs: FTTTx 10 Apr 2014

INCOME TAX /CORPORATION TAX – Losses – interpretation of s118ZC ICTA 1988 limit on loss relief for members of LLPs- test for admissibility of extra-statutory materials not met – whether appellant’s third share in capital of LLP was ‘contributed’ as capital (s118ZC(3) ICTA) on basis that this was the amount appellant had exposed to risk- no – whether appellant’s third share was included in amount the appellant was ‘liable to contribute’ to the assets of the LLP in the event LLP was wound up (s118Z(4)(a) ICTA) – yes – appeal allowed

Citations:

[2014] UKFTT 350 (TC)

Links:

Bailii

Jurisdiction:

England and Wales

Corporation Tax

Updated: 04 October 2022; Ref: scu.525346

Test Claimants In The FII Group Litigation v The Commissioners For Her Majesty’s Revenue and Customs: ECJ 19 Jul 2012

ECJ Articles 49 TFEU and 63 TFEU – Payment of dividends – Corporation tax – Case C-446/04 – Test Claimants in the FII Group Litigation – Interpretation of the judgment – Prevention of economic double taxation – Equivalence of the exemption and imputation methods – Meaning of ‘tax rates’ and ‘different levels of taxation’- Dividends from third countries

Judges:

V Skouris, P

Citations:

C-35/11, [2012] EUECJ C-35/11, [2013] 1 CMLR 50, [2013] 2 WLR 1416, [2012] WLR(D) 323, [2013] BTC 424, [2013] STC 612, [2013] Ch 431, [2012] STI 3271

Links:

Bailii

Statutes:

TFEU 49 63

Jurisdiction:

European

Citing:

See Also – Test Claimants In The FII Group Litigation v CIR ECJ 12-Dec-2006
ECJ (Opinion of Geelhoed AG) Interpretation of Articles 43 and 56 EC and Articles 4(1) and 6 of Council Directive 90/435/EEC of 23 July 1990 on the common system of taxation applicable in the case of parent . .
See Also – Test Claimants In the FII Group Litigation v HM Revenue and Customs ChD 27-Nov-2008
The claimants were companies with parent companies in the UK and other subsidiaries not so resident, both in the EU and outside. They complained of the differences in treatment under corporation tax of the payment of dividends between the . .

Cited by:

See Also – Test Claimants In The FII Group Litigation v Commissioners of Inland Revenue ECJ 5-Sep-2013
ECJ Opinion – Recovery of national taxes which are contrary to European Union law – Limitation period for instituting proceedings – National legislation curtailing the limitation period with retroactive effect . .
See Also – Test Claimants In The FII Group Litigation v Commissioners of Inland Revenue ECJ 12-Dec-2013
ECJ Judicial protection – Principle of effectiveness – Principles of legal certainty and the protection of legitimate expectations – Restitution of sums paid but not due – Remedies – National legislation – . .
See Also – The Test Claimants In The FII Group Litigation v HM Revenue and Customs ChD 18-Dec-2014
The company claimants had paid large sums in excess tax under a mistake of European law. . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax

Updated: 04 October 2022; Ref: scu.463844

A Oy: ECJ 19 Jul 2012

ECJ Opinion – Tax law – Freedom of establishment – Directive 2009/133/EEC – National income tax law – Merger of two companies resident in different Member States – Deductibility of losses of the transferring company in the Member State of the receiving company

Judges:

Kokott AG

Citations:

C-123/11, [2012] EUECJ C-123/11

Links:

Bailii

Jurisdiction:

European

Cited by:

Opinion – A Oy ECJ 21-Feb-2013
ECJ Freedom of establishment – Article 49 TFEU – Tax legislation – Merger of a parent company established in one Member State with a subsidiary established in another Member State – Deductibility by the parent . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax

Updated: 04 October 2022; Ref: scu.463829

Philips Electronics UK Ltd v Revenue and Customs: FTTTx 18 Aug 2009

EUROPEAN LAW – group relief (consortium claim) – whether claimant company not exercising Community rights can seek to disapply UK law affecting a Dutch surrendering company with a UK branch – yes – whether TA 1988 s 406(2) and 403D(1)(c) contain restrictions on the right of establishment – yes – whether such restrictions can be justified – no – whether (if it could be justified) s 403D(1)(c) would be proportional – no

Citations:

[2009] UKFTT 226 (TC)

Links:

Bailii

Jurisdiction:

England and Wales

Corporation Tax, European

Updated: 01 October 2022; Ref: scu.409032

Foggia-Sociedade Gestora De Participacoes Sociais (Taxation): ECJ 10 Nov 2011

ECJ Approximation of laws – Directive 90/434/EEC – Common system of taxation applicable to mergers, divisions, transfers of assets and exchanges of shares concerning companies of different Member States – Article 11(1)(a) – Valid commercial reasons – Restructuring or rationalisation of the activities of companies participating in operations – Definition

Judges:

M. Safjan, P

Citations:

C-126/10, [2011] EUECJ C-126/10

Links:

Bailii

Statutes:

Directive 90/434/EEC

Jurisdiction:

England and Wales

European, Corporation Tax

Updated: 26 September 2022; Ref: scu.448347

UBS Ag v HM Revenue and Customs: ChD 7 Feb 2006

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 21-Feb-2006, [2006] EWHC 117 (Ch)

Links:

Bailii

Statutes:

Income and Corporation Taxes Act 1988 243, UK-Switzerland Double Taxation Convention of 8 December 1977

Jurisdiction:

England and Wales

Citing:

Appeal from – UBS Ag v Revenue and Customs SCIT 7-Jun-2005
SCIT DOUBLE TAXATION AGREEMENT – non-discrimination – whether UK permanent establishment of Swiss company entitled to payment of the tax credit on dividends under s 243 Taxes Act 1988 – yes, on the interpretation . .

Cited by:

Appeal from – HM Revenue and Customs v UBS Ag CA 21-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. . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax

Updated: 25 September 2022; Ref: scu.238349

HM Inspector of Taxes v Mars UK Ltd: ChD 12 Apr 2005

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. It extended to depreciation not charged as an expense but as a cost of carrying the stock.

Judges:

Lightman J

Citations:

[2005] EWHC 553 (Ch), Times 11-May-2005

Links:

Bailii

Statutes:

Income and Corporation Taxes Act 1988 74(1), Finance Act 1998 42, Companies Act 1985 226

Jurisdiction:

England and Wales

Corporation Tax

Updated: 25 September 2022; Ref: scu.224107

Shop Direct Group v Revenue and Customs: SC 17 Feb 2016

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 come into existent. The parties now disputed liability to income tax on such repayments and the interest. At each earlier stage the group had been found liable to income tax, and they now appealed again, suggesting that the original source of the sums repaid had been trading receipts.
Held: The appeal failed. Section does not contain any implied restriction so limiting the charge to tax on post-cessation receipts falls only on the former trader whose trade was the source of the income. Three reasons supported the conclusion: First, there is nothing in the wording of section 103(1) or (2) which necessitated such implication.
The charge to tax is clear: where a trade has been permanently discontinued, corporation tax shall be charged on ‘sums arising from the carrying on of the trade . . during any period before the discontinuance’. Section 103(1) required only that the sums ‘are received’ after the discontinuance;
it specified the source of the sums falling within the charge but imposed no further restriction
Section 103 was designed to catch the ‘fruit’ of the trade. Its aim was to make sure that sums which a person received, which arose from a discontinued trade and which were not otherwise taxed, were brought into a charge to tax. No sound policy reason had been suggested for confining the charge to the former trader
Thirdly, the neighbouring provisions of section 103 drew a distinction between the person chargeable to tax and the person who had previously carried on the trade. This suggested that the former was not confined to the latter.
Lord Hodge said: ‘In summary, (i) the basic rule in section 103 is that sums arising from the carrying on of the trade before discontinuance are, if received after discontinuance, charged to tax under Case VI of Schedule D; (ii) there is no restriction in section 103 itself on who the recipient of those fruits of the trade may be; (iii) section 106(1) quantifies the section 103 charge at the amount of the consideration or the market value of the rights to such sums when the former trader transfers its rights to those future receipts for value and the subsection imposes the charge on the former trader; and (iv) section 106(2) disapplies section 103 and substitutes Case I of Schedule D only if the transferee company is carrying on the continuing business when it receives the fruits of the trade, which is deemed to have been discontinued.!

Judges:

Lord Neuberger, President, Lord Reed, Lord Carnwath, Lord Hughes, Lord Hodge

Citations:

[2016] UKSC 7, [2016] BTC 8, [2016] 1 WLR 733, [2016] STC 747, [2016] WLR(D) 83, [2016] STI 393, [2016] 2 All ER 725, [2017] AC 387, UKSC 2014/0110

Links:

Bailii, Bailii Summary, SC, SC Summary

Statutes:

Income and Corporation Taxes Act 1988 103 106

Jurisdiction:

England and Wales

Citing:

At FTTTx – Shop Direct Group and Others v Revenue and Customs FTTTx 14-Feb-2012
FTTTx Corporation tax – receipts of payments in respect of overpaid VAT and statutory interest – whether VAT repayments trading receipts – whether payments in respect of supplies made in discontinued trades . .
Cited – Bennett v Ogston (HM Inspector of Taxes) KBD 30-Apr-1930
Income Tax, Schedule D, Case III – Instalments on moneylender’s promissory notes – Whether such part of instalments falling due after the death of the lender as did not represent repayment of capital was assessable as interest under Case III – . .
At UTTC – Shop Direct Group, Littlewoods Retail Ltd and Others v HMRC UTTC 19-Apr-2013
UTTC Corporation Tax: Effect of receipt by trader or successor to trade of sums in respect of VAT repaid under s80 VATA to representative member of VAT group plus interest paid under s78 VATA. Question of . .
Cited – Carson (H M Inspector of Taxes) v Cheyney’s Executor HL 25-Nov-1958
Income Tax, Schedule D – Copyright royalties – Payable to executor of author under agreement made in his lifetime – Income Tax Act, 1952 (15 and 16 Geo. VI and 1 Eliz. II, c. 10), Schedule D, Cases III, V and VI. . .
Cited – Purchase (H M Inspector of Taxes) v Stainer’s Executorsz HL 29-Nov-1951
HL Income Tax, Schedule D – Film actor and producer-Remuneration including right of participation in profits of, or receipts from, particular films-Sums in respect of such participations paid to executors – . .
Cited – The National Provident Institution v Brown (Surveyor of Taxes) HL 3-Jun-1921
The House was asked (inter alia) whether discounts on certain Treasury Bills could be subject to taxation, on a preceding year basis, for a year in which the taxpayer did not hold or have any transactions in the relevant securities.
Held: The . .
Cited – Reynolds and Gibson v Crompton (H M Inspector of Taxes), Reynolds and Gibson v Inland Revenue HL 26-Mar-1952
HL Income Tax, Schedule D, and Profits Tax-Profits of trade-Debt taken over at reduced valuation on change of partnership and subsequently recovered in full-Whether profit assessable.
A partnership of cotton . .
Cited – Hochstrasser (HM Inspector of Taxes) v Mayes ; Jennings v Kinder (HM Inspector of Taxes) HL 20-Nov-1959
A company operated a housing scheme for married employees who made transferred from one part of a country to another. Under the scheme an employee might be offered a loan to assist in the purchase of a house and, provided the house was maintained in . .
Cited – Abbott v Philbin (Inspector of Taxes) HL 21-Jun-1960
A company’s senior employees had been given an option to subscribe for its shares at the then current market price, the option being exercisable at any time within the next ten years. The employees were thus incentivised to increase the company’s . .
Cited – Chinn v Hochstrasser (Inspector of Taxes) HL 11-Dec-1980
The House considered the meaning of the word ‘bounty’ in an income tax context, where it had been used by the courts: ‘My Lords, I would venture to point out that the word ‘bounty’ appears nowhere in the statute. It is a judicial gloss upon the . .
Cited – W T Ramsay Ltd v Inland Revenue Commissioners HL 12-Mar-1981
The taxpayers used schemes to create allowable losses, and now appealed assessment to tax. The schemes involved a series of transactions none of which were a sham, but which had the effect of cancelling each other out.
Held: If the true nature . .
At ChD – Shop Direct Group and Others v HM Revenue and Customs ChD 19-Apr-2013
. .
Appeal from – Shop Direct Group v Revenue and Customs CA 11-Mar-2014
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. . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax

Updated: 25 September 2022; Ref: scu.560127

Shop Direct Group v Revenue and Customs: CA 11 Mar 2014

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 Wales

Citing:

At FTTTx – Shop Direct Group and Others v Revenue and Customs FTTTx 14-Feb-2012
FTTTx Corporation tax – receipts of payments in respect of overpaid VAT and statutory interest – whether VAT repayments trading receipts – whether payments in respect of supplies made in discontinued trades . .
At UTTC – Shop Direct Group, Littlewoods Retail Ltd and Others v HMRC UTTC 19-Apr-2013
UTTC Corporation Tax: Effect of receipt by trader or successor to trade of sums in respect of VAT repaid under s80 VATA to representative member of VAT group plus interest paid under s78 VATA. Question of . .
Appeal from – Shop Direct Group and Others v HM Revenue and Customs ChD 19-Apr-2013
. .
Cited – The National Provident Institution v Brown (Surveyor of Taxes) HL 3-Jun-1921
The House was asked (inter alia) whether discounts on certain Treasury Bills could be subject to taxation, on a preceding year basis, for a year in which the taxpayer did not hold or have any transactions in the relevant securities.
Held: The . .
Cited – Bennett v Ogston (HM Inspector of Taxes) KBD 30-Apr-1930
Income Tax, Schedule D, Case III – Instalments on moneylender’s promissory notes – Whether such part of instalments falling due after the death of the lender as did not represent repayment of capital was assessable as interest under Case III – . .

Cited by:

Appeal from – Shop Direct Group v Revenue and Customs SC 17-Feb-2016
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 . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax

Updated: 25 September 2022; Ref: scu.522298

Commission v Electricite de France: ECJ 20 Oct 2011

ECJ Opinion – State Aid – Appeal – State aid – Selective tax exemption linked to an increase in share capital during the recapitalisation of an undertaking – Market economy investor principle – State acting as shareholder and State wielding public power

Judges:

Mazak AG

Citations:

C-124/10, [2011] EUECJ C-124/10 – P, [2011] EUECJ C-124/10 – P

Links:

Bailii, Bailii

Citing:

See Also – Commission v Electricite de France ECJ 2-Sep-2010
ECJ (Order) – Intervention – EFTA Surveillance Authority – Article 40, second and third paragraphs of the Statute of the Court’ . .

Cited by:

See Also – Commission v Electricite de France ECJ 5-Jun-2012
ECJ (Grand Chamber) Appeal – State aid – Waiver of a tax claim – Exemption from corporation tax – Increase in share capital – Conduct of a State acting as a prudent private investor in a market economy – Criteria . .
Lists of cited by and citing cases may be incomplete.

European, Utilities, Corporation Tax

Updated: 22 September 2022; Ref: scu.445988

HM Revenue and Customs v Marks and Spencer Plc: CA 14 Oct 2011

The taxpayers claimed relief for losses incurred within their European subsidiaries. The claim having been referred to the ECJ, Moses LJ summarised the issues outstanding: ‘(i) Is the test that the ECJ established to identify those circumstances in which it would be unlawful to preclude cross-border relief for losses, the ‘no possibilities’ test, to be applied (as the Revenue contend) at the end of the accounting period in which the losses crystallised rather than (as MandS contends) the date of claim? This question involves deciding whether the Court of Appeal in the first appeal reached a binding decision on that issue and whether it remains binding on this court in light of subsequent decisions of the ECJ.
(ii) Can sequential / cumulative claims be made (as MandS contends) by the same company for the same losses of the same surrendering company in respect of the same accounting period? The Revenue assert that that is not a question decided by the Court of Appeal and is precluded both by UK fiscal rules and by the underlying jurisprudence of the ECJ.
(iii) If a surrendering company has some losses which it has or can utilise and others which it cannot, does the no possibilities test (as the Revenue contend) preclude transfer of that proportion of the losses which it has no possibility of using?
(iv) Does the principle of effectiveness require MandS to be allowed to make fresh ‘pay and file’ claims now that the ECJ has identified the circumstances in which losses may be transferred cross-border, when at the time MandS made those claims there was no means of foreseeing the test established by the court?
(v) What is the correct method of calculating the losses available to be transferred?’
Held: The Court efused HMRC’s appeal on the first, second, third and fifth issues. It refused MandS’s appeal on the fourth issue

Judges:

Lloyd, Moses, Etherton LJJ

Citations:

[2011] EWCA Civ 1156, [2011] STI 2843, [2011] BTC 589, [2012] STC 231, [2011] NPC 103

Links:

Bailii

Jurisdiction:

England and Wales

Citing:

At FTTTx – Marks and Spencer plc v Revenue and Customs FTTTx 2-Apr-2009
FTTTx EUROPEAN LAW – group relief for losses of non-resident subsidiaries – whether there are no possibilities for those losses to be taken into account at the date of the group relief claim – no at the date of . .
Appeal from – Marks and Spencer Plc v HM Revenue and Customs UTTC 21-Jun-2010
UTTC EUROPEAN LAW – group relief for losses of non-resident subsidiaries – whether there are no possibilities for those losses to be taken into account at the date of the group relief claim – date of valid claim . .
See Also – Marks and Spencer Plc v Halsey (Inspector of Taxes) 2003
Marks and Spencer Plc appealed against the refusal of group relief, on the ground that the statutory limitations on the territorial scope of group relief were incompatible with, and overridden by, Community law. The Special Commissioners dismissed . .
At ECJ – Marks and Spencer v David Halsey (Inspector of Taxes) ECJ 13-Dec-2005
ECJ Articles 43 EC and 48 EC – Corporation tax – Groups of companies – Tax relief – Profits of parent companies – Deduction of losses incurred by a resident subsidiary- Allowed – Deduction of losses incurred in . .
See Also – Marks and Spencer plc v Halsey (Inspector of Taxes) ChD 10-Apr-2006
The court considered the implementation of the ECJ decision between the parties.
Held: The matter was to be remitted to the Special Commissioners. The ‘no possibilities’ test referred to in the ECJ’s judgment required an analysis of the . .
See Also – Halsey (HM Inspector of Taxes) v Marks and Spencer Plc CA 20-Feb-2007
The inspector appealed against a decision granting group relief to the taxpayer a UK resident company for losses by a group company in another European state.
Held: The appeal was denied. To refuse group relief in these circumstances would be . .

Cited by:

Appeal from – Revenue and Customs v Marks and Spencer Plc SC 22-May-2013
The company wished to assign losses in its European subsidiaries against its profits. Since the losses were first claimed, the subsidiaries had gone into insolvent liquidation.
Held: Lord Hope said: ‘I would answer the first issue by rejecting . .
At CA – Revenue and Customs v Marks and Spencer Plc SC 19-Feb-2014
For the purposes of corporation tax, MandS claimed group relief in respect of losses sustained by two of their subsidiaries, resident in Germany and in Belgium. Lord Hope observed that the claims were originally made and refused by HMRC over ten . .
Lists of cited by and citing cases may be incomplete.

European, Corporation Tax

Updated: 20 September 2022; Ref: scu.445635

Colonial Life Insurance Co (Trinidad) Ltd v The Board of Inland Revenue Trinidad and Tobago Co: PC 1 Jul 1991

(Trinidad and Tobago) The Board was asked whether income reveived ny the appellant from the investment of monies paid to it as consideration for the provision of pensions for employees for contributing companies was exempt from corporation tax as ‘profits of approved annuity business’.

Citations:

[1991] UKPC 25

Links:

Bailii

Commonwealth, Corporation Tax

Updated: 17 September 2022; Ref: scu.442674

Andersen og Jensen v Skatteministeriet: ECJ 15 Jan 2002

ECJ Approximation of laws – Directive 90/434/EEC – Common system of taxation applicable to mergers, divisions, transfers of assets and exchanges of shares – Transfer of assets or of a branch of activity – Meaning

Judges:

P. Jann P

Citations:

C-43/00, [2002] EUECJ C-43/00

Links:

Bailii

Statutes:

Directive 90/434/EEC

Jurisdiction:

European

Corporation Tax

Updated: 16 September 2022; Ref: scu.167455

Market South West (Holdings) Ltd v HMRC: UTTC 6 Apr 2011

PROFITS – capital or revenue expenditure – costs of planning inquiry – taxpayer claiming conditions in planning permission invalid or seeking relaxation of the conditions – part capital, part revenue – remitted to the First-tier Tribunal for an apportionment

Citations:

[2011] UKUT B15 (TCC), [2011] STC 1469

Links:

Bailii

Jurisdiction:

England and Wales

Corporation Tax

Updated: 13 September 2022; Ref: scu.440822

Six Continents Ltd v The Commissioners of Inland Revenue: ChD 2 Feb 2016

Challenge to lawfulness of a tax imposed on restitutions of tax made by HMRC. The claimant sought leave to amend their particulars.
Held: None of the amendments had any realistic prospect of success and permission was refused.

Judges:

Henderson J

Citations:

[2016] EWHC 169 (Ch)

Links:

Bailii

Statutes:

Finance (No. 2) Act 2015 38, Corporation Tax Act 2010 Part C

Jurisdiction:

England and Wales

Corporation Tax, Human Rights

Updated: 08 September 2022; Ref: scu.559428

Metso Paper Bender Forrest Ltd and Another v Revenue and Customs: FTTTx 19 Nov 2013

CORPORATION TAX – Exemptions and reliefs – Schedule 23 Finance Act 2003 – does option have to be acquired, as a matter of fact, by reason of employment with the employer company – yes – appeal dismissed

Citations:

[2013] UKFTT 674 (TC)

Links:

Bailii

Statutes:

Finance Act 2003

Jurisdiction:

England and Wales

Corporation Tax

Updated: 03 September 2022; Ref: scu.518621

Test Claimants In The Thin Cap Group Litigation v HM Revenue and Customs: CA 18 Feb 2011

The Claimants argued that provisions of UK corporate tax legislation were incompatible with a fundamental freedom conferred by the EC Treaty.

Judges:

Arden, Rimer, Stanley Burnton LLJ

Citations:

[2011] EWCA Civ 127

Links:

Bailii

Jurisdiction:

England and Wales

Corporation Tax, European

Updated: 02 September 2022; Ref: scu.429649

JT Dove Ltd v Revenue and Customs: FTTTx 1 Dec 2010

Corporation tax – deductibility of payment to employee benefit trust (EBT) – whether payment made wholly and exclusively for the purpose of appellant’s trade – ICTA 1988 s 74(1)(a) – whether payment revenue or capital expenditure – ICTA, s 74(1)(f) – whether payment a ‘potential emolument’ – FA 1989, s 43(11)

Citations:

[2011] UKFTT 16 (TC)

Links:

Bailii

Jurisdiction:

England and Wales

Corporation Tax

Updated: 01 September 2022; Ref: scu.428211

Revenue and Customs v SSE Generation Ltd: UTTC 4 Nov 2019

Corporation Tax – Capital Allowances- eligibility of various structures of a hydroelectric power generation scheme for capital allowances – ss 11 and 21 to 23 Capital Allowances Act 2001.

Citations:

[2019] UKUT 332 (TCC)

Links:

Bailii

Statutes:

Capital Allowances Act 2001

Jurisdiction:

England and Wales

Corporation Tax

Updated: 01 September 2022; Ref: scu.643800

Dean and Reddyhoff Ltd v Revenue and Customs: FTTTx 26 Jun 2013

CORPORATION TAX – relief for remediation of contaminated land -capital expenditure on various items of sea defences in course of construction of a marina – whether land in a contaminated state by reason of seawater on foreshore – yes – breakwater constructed on seabed – not expenditure on land – sea defences constructed on foreshore – qualifying land remediation expenditure – works carried out on land above high water mark – not qualifying land remediation expenditure – paras 1, 2, 3, 4, and 7 Schedule 22 Finance Act 2001 – appeal allowed in part

Citations:

[2013] UKFTT 367 (TC)

Links:

Bailii

Jurisdiction:

England and Wales

Corporation Tax

Updated: 31 August 2022; Ref: scu.513482

Taylor (Inspector of Taxes) v MEPC Holdings Ltd: CA 20 Jun 2002

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 which arose other than in the same accounting period. That restriction was not itself restricted only to trading and capital allowances, but included also sums of the type sought to be brought in by the taxpayer. The provisions have since been changed.

Judges:

Lord Justice Pill, Lord Justice Chadwick and Lord Justice Clarke

Citations:

Times 03-Jul-2002, Gazette 08-Aug-2002, [2002] EWCA Civ 883, [2002] STC 997, 75 Tax Cas 632

Links:

Bailii

Statutes:

Income and Corporation Taxes Act 1988 433, Taxation of Capital Gains Act 1992 8(1)

Jurisdiction:

England and Wales

Citing:

Appeal from – Taylor (Inspector of Taxes) v MEPC Holdings Ltd ChD 12-Jun-2001
The amount of loss available to a company for surrender was restricted to trading losses or capital allowances, and was not to include allowable losses. The sums to be surrendered were those which might appear in a calculation of profits for the . .

Cited by:

Appealed to – Taylor (Inspector of Taxes) v MEPC Holdings Ltd ChD 12-Jun-2001
The amount of loss available to a company for surrender was restricted to trading losses or capital allowances, and was not to include allowable losses. The sums to be surrendered were those which might appear in a calculation of profits for the . .
Appeal from – Taylor (Her Majesty’s Inspector of Taxes) v MEPC Holdings Limited HL 18-Dec-2003
The taxpayer company made a smaller profit than its charges, and sought to reallocate the charges against income for other companies within the group. It could do so, but the difference arose over the period for which surrender would be alowed.
Lists of cited by and citing cases may be incomplete.

Corporation Tax

Updated: 27 August 2022; Ref: scu.174168

Atkinson (HM Inspector of Taxes) v Camas Plc: CA 6 May 2004

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] STC 860, [2004] STI 1163, [2004] 1 WLR 2392

Links:

Bailii

Statutes:

Income and Corporation Taxes Act 1988 75 130

Jurisdiction:

England and Wales

Citing:

Cited – Hoechst Finance Limited v Gumbrell CA 1983
The issue was whether the appellant company, a member of an international group of trading companies, could recover as expenses of management a commission of 0.25% per annum it had to pay to its parent as the price of obtaining a guarantee for the . .
Cited – Sun Life Assurance Society v Davidson HL 4-Jul-1957
The court considered the question of what was meant by the phrase ‘expenses of management’
Held: The phrase (s75) could be seen ‘as apt to cover the expenses which would normally be deductible in respect of its life assurance business if an . .
Cited – Norman v Golder (Inspector of Taxes) 1944
The court considered the nature of allowable expenses for an investment company: ‘the notion behind this Section may be thought to be that the expenditure is something which if you were looking at the profits and gains under Schedule D would be . .
Cited – Sun Life Assurance Society v Davidson CA 1956
The phrase ‘general management’ extended further than ‘management’ and included what was done at the lower levels of a company’s executive structure.
Romer LJ said: ‘The ratio decidendi of Golder’s Case (Capital and National Trust Ltd. v. . .
Cited – Taylor (Her Majesty’s Inspector of Taxes) v MEPC Holdings Limited HL 18-Dec-2003
The taxpayer company made a smaller profit than its charges, and sought to reallocate the charges against income for other companies within the group. It could do so, but the difference arose over the period for which surrender would be alowed.
Cited – Inland Revenue Commissioners v British Salmson Aero Engines Ltd CA 1938
The court considered the applicability of certain provisions to royalty payments. The court considered the notorious difficulty of drawing a clear line between capital and income receipts: ‘There have been many cases which fall on the border-line. . .
Cited – London County Freehold and Leasehold Properties Ltd v Sweet 1942
Expenditure by a property company on the issue of new debenture stock was not ‘expenses of management’ because raising capital was not part of the business of acquiring and managing property. . .
Cited – Cunliffe v Goodman CA 1950
Action for damages for breach of a repairing covenant on the expiry of a lease. The court looked at the intention required of a landlord to show an intended purpose to oppose renewal of a lease. Asquith LJ said: ‘An ‘intention’ to my mind connotes a . .
Appeal from – Camas Plc v HM Inspector of Taxes ChD 7-Jul-2003
An investment company sought to set against its liability to corporation tax, the various costs of taking over another company. They argued that as an investment company these were not costs of the purchase and could be set against tax.
Held: . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax

Updated: 24 August 2022; Ref: scu.196622

Britax International Gmbh v Commissioners of Inland Revenue: CA 31 May 2002

‘The issue in the appeal is as to the true construction of section 35(2) in Chapter III of Part II of the Capital Allowances Act 1990 . . Section 35(2) restricts the extent to which expenditure on the ‘hiring’ of an ‘expensive motor car’ (that is to say, a car the retail price of which when new exceeds a specified sum, currently pounds 12,000) is deductible in computing the profits of a trade for tax purposes. The issue is whether (as Britax contends) ‘hiring’ in the context of section 35(2) is limited to contracts of hire under which the hirer is the end-user, in the sense that he (or, in the case of a company, its servants or agents) enjoys the physical use of the car: or whether (as the Revenue contends) it applies to all contracts of hire, whether or not the hirer may in turn have entered into a contract of sub-hire to a third party end-user.’

Judges:

Lord Justice Jonathan Parker

Citations:

[2002] EWCA Civ 806, [2002] STC 956

Links:

Bailii

Jurisdiction:

England and Wales

Corporation Tax

Updated: 24 August 2022; Ref: scu.172273

Glaxo Group Ltd and Others v Inland Revenue Commissioners: ChD 21 Nov 1995

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 proceedings which are, and those which are not, objectionable as attempts to circumvent the exclusive jurisdiction principle. Possibly the correct view is that there is an absolute exclusion of the High Court’s jurisdiction only when the proceedings seek relief which is more or less co-extensive with adjudicating on an existing open assessment: but that the more closely the High Court proceedings approximate to that in their substantial effect, the more ready the High Court will be, as a matter of discretion, to decline jurisdiction.’

Judges:

Robert Walker J

Citations:

Times 21-Nov-1995, Ind Summary 11-Dec-1995, [1995] STC 1075

Statutes:

Income and Corporation Taxes Act 1988 770

Jurisdiction:

England and Wales

Cited by:

Appeal from – Glaxo Group Ltd v Inland Revenue Commissioners CA 8-Jan-1996
A transfer pricing direction allowed the Inland Revenue to issue adjustments after 6 years. . .
Applied – Claimants under the Loss Relief Group Litigation Order v Inland Revenue Commissioners ChD 3-Mar-2004
Various claimants sought to have issues of law on group relief and other issues settled under a group litigation order.
Held: The High Court had no jurisdiction to hear such matters until they had first been raised in ordinary tax appeals . .
Cited – UK Tradecorp Ltd, Regina (on the Application of) v Commissioners for Customs and Excise Admn 10-Nov-2004
The trader had traded in zero-rated goods, leading to a net reclaim of input tax. Having submitted a claim, it sought repayment, and interest on the sums withheld.
Held: No duty fell upon the commissioners until they had accepted the claim to . .
Approved – Autologic Holdings Plc and others v Commissioners of Inland Revenue HL 28-Jul-2005
Taxpayer companies challenged the way that the revenue restricted claims for group Corporation Tax relief for subsidiary companies in Europe. The issue was awaiting a decision of the European Court. The Revenue said that the claims now being made by . .
Applied – Capper v Chaney and Another ChD 8-Jul-2010
Police had seized substantial sums of cash from the first defendant acting under the 2004 Act. The claimant said that andpound;250,00 was his and sought its return. The Commissioner argued that the current proceedings were an abuse of process.
Lists of cited by and citing cases may be incomplete.

Corporation Tax

Updated: 24 August 2022; Ref: scu.80861

Eagerpath Ltd v Edwards (Inspector of Taxes): ChD 21 May 1999

Once a dispute on an assessment has been settled between the taxpayer and the Inspector, the taxpayer cannot subsequently appeal against refusal of relief for a claim of an error. There was no point of law in such an error.

Citations:

Times 21-May-1999

Statutes:

Taxes Management Act 1970 54 33

Jurisdiction:

England and Wales

Citing:

Appealed to – Eagerpath Ltd v Edwards (HM Inspector of Taxes) CA 14-Dec-2000
Where the special commissioner had determined that the dispute had been concluded by agreement, the taxpayer was precluded from appealing that decision claiming an ‘error or mistke’ That issue was not one relating to the computation of profits in . .

Cited by:

Appeal from – Eagerpath Ltd v Edwards (HM Inspector of Taxes) CA 14-Dec-2000
Where the special commissioner had determined that the dispute had been concluded by agreement, the taxpayer was precluded from appealing that decision claiming an ‘error or mistke’ That issue was not one relating to the computation of profits in . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax

Updated: 24 August 2022; Ref: scu.80205

Interfish Ltd v Revenue and Customs: FTTTx 13 May 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 Taxes Act 1988, s 74

Judges:

Nicholas Paines QC

Citations:

[2010] UKFTT 219 (TC)

Links:

Bailii

Statutes:

Income and Corporation Taxes Act 1988 74

Cited by:

See Also – Interfish Ltd v Revenue and Customs FTTTx 4-Apr-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 . .
At FTTTx – Interfish Ltd v HM Revenue and Customs UTTC 16-Jul-2013
UTTC 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 . .
At FTTTx – Interfish Ltd v HM Revenue and Customs CA 27-Jun-2014
The company sought to set payments it had made to support a local rugby club off against its income for Corporation Tax purposes.
Held: The appeal failed. The requirement was that the expenditure be wholly necessarily and exclusively for the . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax

Updated: 23 August 2022; Ref: scu.422229

Inland Revenue Commissioners v Laird Group plc: CA 30 Apr 2002

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 definition of a transaction in securities, and was therefore taxable as such. A limitation could not be inferred on the wide words of the section even for fear that it might lead to injustice. The three conditions were required and met, a transaction in securities, prescribed circumstances and a consequential tax advantage.

Judges:

Sir Andrew Morritt, Vice Chancellor, Lord Justice Mummery and Lord Justice Longmore

Citations:

Times 22-May-2002, Gazette 30-May-2002, [2002] EWCA Civ 576, [2002] STC 722

Links:

Bailii

Statutes:

Income and Corporation Taxes Act 1988 709(2)

Jurisdiction:

England and Wales

Citing:

Cited – Inland Revenue Commissioners v Parker HL 1966
A company capitalised a sum standing to the credit of its profit and loss account and applied it in issuing redeemable debentures to its members in proportion to the amounts paid up on their shares. The company subsequently redeemed the debentures . .
Cited – Greenberg v Inland Revenue Commissioners HL 1972
A company created a new class of preferred shares which it issued credited as fully paid to its two shareholders. They sold the shares to a purchaser on terms that the price was to be paid by instalments. Under arrangements made between the parties . .
Cited – Inland Revenue Commissioners v Joiner HL 26-Nov-1975
HL Surtax – Tax advantage – Transaction in securities – Company recon- struction – Surplus assets o f old company distributed in voluntary liquidation – Agreement for liquidation providing for agreed methods o f . .

Cited by:

Appeal from – Her Majesty’s Commissioners of Inland Revenue v Laird Group plc HL 16-Oct-2003
Was the payment of a dividend in respect of shares ‘a transaction in securities’ or ‘a transaction relating to securities’ within the meaning of section 703.
Held: ‘As a matter of ordinary language, the creation, issue, sale, purchase, . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax

Updated: 20 August 2022; Ref: scu.171262

Dawsongroup Plc v Revenue and Customs: ChD 11 May 2010

The Court was asked whether or not certain expenditure incurred by the Appellant (‘Dawsongroup’) was deductible in computing its profits for the purposes of corporation tax

Judges:

Mann J

Citations:

[2010] EWHC 1061 (Ch), [2010] STC 1906, [2010] BTC 1528

Links:

Bailii

Jurisdiction:

England and Wales

Corporation Tax

Updated: 18 August 2022; Ref: scu.415086

Sempra Metals Ltd v Revenue and Customs: SCIT 7 Jul 2008

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 – whether payments to employee benefit trust were potential emoluments and so precluded from deduction for corporation tax purposes when paid – yes – whether payments to family benefit trust were made to an employee benefit scheme and so precluded from deduction for corporation tax purposes when paid – yes – ICTA 1988 ss 42 and 74; FA 1989 s 43(11); FA 2003 s143 and Sch 24
EMPLOYMENT INCOME – whether payments by Appellant to trusts were payments of emoluments or earnings giving rise to an obligation to deduct income tax and pay it to the Revenue – no – before 2003 ICTA 1988 ss 19(1), 131 and 203(1) and Income Tax (Employments) Regulations 1993 SI 1993 No. 744; after 2003 ITEPA 2003 ss 1, 6, and 684 and Income Tax (PAYE) Regulations 2003 SI 2003 No. 2682 Reg 80
NATIONAL INSURANCE CONTRIBUTIONS – whether payments by Appellant to trusts were earnings paid for the benefit of earners – no – Social Security Contributions and Benefits Act 1992 s6(1); Social Security Contributions (Transfer of Functions, etc) Act 1999 s8(1)(c)

Citations:

[2008] UKSPC SPC00698, [2008] STI 1923, 2008] STC (SCD) 1062

Links:

Bailii

Jurisdiction:

England and Wales

Cited by:

Incorrect – RFC 2012 Plc (Formerly The Rangers Football Club Plc) v Advocate General for Scotland SC 5-Jul-2017
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 . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax, Taxes – Other

Updated: 18 August 2022; Ref: scu.642458

Finanzamt Linz v Bundesfinanzgericht, Aussenstelle Linz: ECJ 6 Oct 2015

ECJ Judgment – Reference for a preliminary ruling – Articles 49 TFEU, 54 TFEU, 107 TFEU and 108(3) TFEU – Freedom of establishment – State aid – Taxation of groups of companies – Acquisition of a holding in a subsidiary – Depreciation of the goodwill – Limitation on holdings in resident companies

Citations:

ECLI:EU:C:2015:661, [2015] EUECJ C-66/14

Links:

Bailii

Jurisdiction:

European

Corporation Tax

Updated: 18 August 2022; Ref: scu.553097

Floor v Davis (Inspector of Taxes): HL 1979

The House considered whether the meaning of the phrase ‘a person having control’ extended to control by more than one person. This depended on whether the word ‘person’ in the singular was to be construed as including the plural.
Held: The House applied the 1889 Act. A permissible aid to construction of a stautute is to ask whether, if the defined meaning is used in a particular provision, that provision would be unworkable or produce a result that Parliament could not have intended would be produced.
Viscount Dilhorne said that if a construction of a provision was ‘unworkable, or if not workable [leads] to a result that Parliament could not have intended, then it can be concluded that an intention contrary to the application of the Interpretation Act appears.’ and ‘It must be borne in mind that the Interpretation Act is to apply unless a contrary intention is shown. It is not the case that an intention that the Act should apply has to be shown for it to apply.’
Lord Wilberforce said: ‘It does not require authority to establish that the Act is one for the convenience of drafting: ‘for further shortening the language used in Acts of Parliament’, nor that a contrary intention may be gathered from the sense an intention of the Act in question. Though the Act appears to state a presumption this is not a strong one. Speaking of the common law presumption (which applied before the Interpretation Act 1889) that ‘person’ in an Act of Parliament includes ‘corporations’ Lord Blackburn said in Pharmaceutical Society v London and Provincial Supply Association Ltd (1880) 5 App Cas 857, 869: ‘Circumstances, and indeed circumstances of a slight nature in the context, might show in which way the word is to be construed in an Act of Parliament … whenever you can see that the object of the Act requires that the word ‘person’ shall have the more extended or less extended sense, then, whichever sense it requires, you should apply the word in that sense . .’ I do not think that the Act intends to apply any different test.’
Lord Woolf said: ‘It is the repealing Act, not the Act of 1974, which is required to manifest the contrary intention so as to exclude the operation of section 16. Were the position otherwise the object of section 16, which is to make it unnecessary to include in the subsequent legislation the provisions contained in section 16, would be frustrated. The silence of the subsequent legislation is consistent and not inconsistent with section 16 applying.’

Judges:

Viscount Dilhorne, Lord Wilberforce, Lord Woolf

Citations:

[1980] AC 695, [1979] 2 WLR 830, [1979] 2 All ER 677

Statutes:

Finance Act 1965 45 Sch7 15(2), Interpretation Act 1889 1(1)

Jurisdiction:

England and Wales

Citing:

Cited – Pharmaceutical Society v London and Provincial Supply Association Ltd 11-Jan-1880
Lord Blackburn spoke of the presumption at common law that the word ‘person’ in an Act of Parliament includes ‘corporations’: ‘Circumstances, and indeed circumstances of a slight nature in the context, might show in which way the word is to be . .
Appeal from – Floor v Davis (Inspector of Taxes) CA 1979
The court considered the taxation of a sale of shares in one company called IDM to a company (FNW) and a further sale by that company to a yat another company (KDI). Held(Majority) It was right to look at each of the sales separately. The court . .

Cited by:

Cited – Secretary of State for Justice v Slee EAT 19-Jul-2007
EAT Unfair Dismissal – Constructive dismissal
Maternity Rights and Parental Leave – Sex discrimination
The Claimant was employed as a Magistrates’ Clerk and she brought successful claims to the . .
Cited – Crown Prosecution Service v Inegbu Admn 26-Nov-2008
The CPS appealed aganst a decision on a charge under the railway byelaws, that the charge be dismissed, the prosecution not having formally proved in accordance with any applicable statutory provision. The byelaws had in fact been properly . .
Lists of cited by and citing cases may be incomplete.

Litigation Practice, Corporation Tax

Updated: 18 August 2022; Ref: scu.449978

Huntley Solutions Ltd v The Commissioners for Revenue and Customs: FTTTx 30 Nov 2009

Penalty – Failure to provide information and documents – reliance on accountant – Whether reasonable excuse – No – Appeal dismissed – Paragraph 29 schedule 18 Finance Act 1998

Citations:

[2009] UKFTT 329 (TC)

Links:

Bailii

Jurisdiction:

England and Wales

Corporation Tax

Updated: 17 August 2022; Ref: scu.409108

Marks and Spencer Plc v Revenue and Customs: FTTTx 24 Aug 2009

Judges:

Avery Jones TJ

Citations:

[2009] UKFTT 231 (TC), [2009] STI 2896, [2009] SFTD 757

Links:

Bailii

Jurisdiction:

England and Wales

Citing:

SeeAlso – Marks and Spencer plc v Revenue and Customs FTTTx 2-Apr-2009
FTTTx EUROPEAN LAW – group relief for losses of non-resident subsidiaries – whether there are no possibilities for those losses to be taken into account at the date of the group relief claim – no at the date of . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax

Updated: 17 August 2022; Ref: scu.409030

Helena Housing Ltd v Revenue and Customs: FTTTx 1 Feb 2010

FTTTx CORPORATION TAX – ASSESSMENT – DEDUCTION FOR EXPENDITURE – Was the expenditure incurred wholly and exclusively for its Schedule A business – No – Was the Appellant a Charity – No – Appeal dismissed

Citations:

[2010] UKFTT 71 (TC), [2010] SFTD 515

Links:

Bailii

Jurisdiction:

England and Wales

Citing:

Cited – Prudential Assurance Co Ltd v Inland Revenue Commissioners ChD 2002
The taxpayer company had entered into two contracts on the same day. The contracts involved a taxpayer buying a freehold property from developers coupled with a separate development agreement under which the developers would complete construction . .

Cited by:

At FTTTx – Helena Partnerships Ltd v HM Revenue and Customs CA 9-May-2012
The company had undertaken substantial building works and sought associated tax relief. The court was asked whether, following a change in the company’s memorandum and articles of association, the company, a registered social landlord, remained a . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax, Charity

Updated: 17 August 2022; Ref: scu.408925

Barclays Mercantile Business Finance Ltd v Mawson, HM Inspector of Taxes: CA 13 Dec 2002

The taxpayer entered into a sale and leaseback arrangement in respect of a gas pipeline, and sought to set off the costs as a capital allowance.
Held: The company’s appeal succeeded: ‘There is nothing in the statute to suggest that ‘up-front finance’ for the lessee is an essential feature of the right to allowances. The test is based on the purpose of the lessor’s expenditure, not the benefit of the finance to the lessee.’
Carnwath LJ said that taxing statutes generally ‘draw their life-blood from real world transactions with real world economic effects’. Secondly, the prodigious intellectual effort in support of tax avoidance results in transactions being structured ‘in a form which will have the same or nearly the same economic effect as a taxable transaction but which it is hoped will fall outside the terms of the taxing statute’. He continued: ‘It is characteristic of these composite transactions that they will include elements which have been inserted without any business or commercial purpose but are intended to have the effect of removing the transaction from the scope of the charge.’

Judges:

Carnwath LJ

Citations:

[2002] STI 1809, [2002] EWCA Civ 1853, [2003] BTC 81, [2003] STC 66

Links:

Bailii

Jurisdiction:

England and Wales

Citing:

Appeal from – Barclays Mercantile Business Finance Ltd v Mawson (Inspector of Taxes) ChD 22-Jul-2002
The taxpayer sought to claim for capital allowances of andpound;91 million for gas pipelines. The claimant had provided the equipment through a leasing scheme.
Held: The leases were unusual, but did not appear to be merely part of a tax . .

Cited by:

Appeal from – Barclays Mercantile Business Finance Ltd v Mawson (HM Inspector of Taxes) HL 25-Nov-2004
The company had paid substantial sums out in establishing a gas pipeline, and claimed those sums against its tax as capital allowances. The transaction involved a sale and leaseback arrangement which the special commissioners had found to be a . .
Cited – Gaines-Cooper v HM Revenue and Customs ChD 13-Nov-2007
The parties disputed the domicile of the tax-payer. He had a domicile of origin in the UK, but asserted that he had acquired a domicile of choice in the Seychelles. The Special Commissioners had allowed, in assessing the domicile at any time, of . .
Cited – RFC 2012 Plc (Formerly The Rangers Football Club Plc) v Advocate General for Scotland SC 5-Jul-2017
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 . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax, Taxes Management

Updated: 16 August 2022; Ref: scu.188983

Dextra Accessories Ltd and others v Inspector of Taxes: SCIT 25 Jul 2002

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 as emoluments – no
Funds were held by trustees ‘with a view to becoming relevant emoluments’ only if the purpose of the contributing company was that they should be used to pay emoluments. In this case, the terms of the trust deed showed that the contributing companies had other purposes as well.

Judges:

Dr Avery Jones CBE

Citations:

[2002] UKSC SPC00331, [2002] STC (SCD) 413

Links:

Bailii

Statutes:

Finance Act 1989 43(11)

Jurisdiction:

England and Wales

Cited by:

Appeal from – MacDonald (Inspector of Taxes) v Dextra Accessories Ltd and Others ChD 16-Apr-2003
The inspector sought to disallow charging to current tax period payments made by the employer to an employee benefit trust.
Held: The payments were not made and held by the trustees ‘with a view to becoming relevant emoluments’ within the . .
At Special Commissioners – MacDonald (HM Inspector of Taxes) v Dextra Accessories Ltd and others CA 28-Jan-2004
The company had set up a trust for the benefit of its employees. The Inspector sought to tax the payments made into the trust as ’emoluments’
Held: The appeal was allowed. The payments were ‘potential emoluments’ which were held by the . .
Special Commissioners – HM Inspector of Taxes v Dextra Accessories Ltd HL 7-Jul-2005
The taxpayer companies had paid funds into a trust for employees. They sought to set off the payments against their liability to corporation tax. The revenue argued that they were deductible only in the year in which they were paid to the employees. . .
Cited – RFC 2012 Plc (Formerly The Rangers Football Club Plc) v Advocate General for Scotland SC 5-Jul-2017
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 . .
Lists of cited by and citing cases may be incomplete.

Income Tax, Corporation Tax

Updated: 16 August 2022; Ref: scu.195400

Bayfine UK v Revenue and Customs: ChD 23 Mar 2010

Judges:

Peter Smith J

Citations:

[2010] EWHC 609 (Ch), [2010] BTC 467, 12 ITL Rep 935, [2010] STI 1284, [2010] STC 1379

Links:

Bailii

Jurisdiction:

England and Wales

Cited by:

Appeal from – Bayfine UK v HM Revenue and Customs CA 23-Mar-2011
The revenue appealed against the confirmation of the grant of double taxation relief to the taxpayer company. The Court was asked whether the UK company was entitled under article 23(2)(a) to a credit, to set against UK tax on its profits, in . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax

Updated: 16 August 2022; Ref: scu.403482

Franked Investment Group Litigation Test Claimants v Inland Revenue and Another: CA 23 Feb 2010

Citations:

[2010] EWCA Civ 103

Links:

Bailii

Jurisdiction:

England and Wales

Citing:

Cited – Kleinwort Benson Ltd v Lincoln City Council etc HL 29-Jul-1998
Right of Recovery of Money Paid under Mistake
Kleinwort Benson had made payments to a local authority under swap agreements which were thought to be legally enforceable when made. Subsequently, a decision of the House of Lords, (Hazell v. Hammersmith and Fulham) established that such swap . .
Appeal from – Test Claimants In the FII Group Litigation v HM Revenue and Customs ChD 27-Nov-2008
The claimants were companies with parent companies in the UK and other subsidiaries not so resident, both in the EU and outside. They complained of the differences in treatment under corporation tax of the payment of dividends between the . .

Cited by:

Appeal from – Test Claimants In The Franked Investment Income Group Litigation v Inland Revenue SC 23-May-2012
The European Court had found the UK to have unlawfully treated differently payment of franked dividends between subsidiaries of UK companies according to whether all the UK subsidiaries were themselves UK based, thus prejudicing European . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax, European

Updated: 14 August 2022; Ref: scu.401676

Girobank Plc v Clarke (Inspector of Taxes): ChD 21 Mar 1996

The part use of an industrial building as an office defeats a capital allowance claim.

Citations:

Gazette 01-May-1996, Times 21-Mar-1996

Statutes:

Capital Allowances Act 1990 18

Jurisdiction:

England and Wales

Citing:

Appealed to – Girobank Plc v Clarke (HM Inspector of Taxes) CA 19-Dec-1997
The use of a building for data processing does not qualify it as the subjection of goods or materials to any process and therefore no capital allowance was claimable. . .

Cited by:

Appeal from – Girobank Plc v Clarke (HM Inspector of Taxes) CA 19-Dec-1997
The use of a building for data processing does not qualify it as the subjection of goods or materials to any process and therefore no capital allowance was claimable. . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax

Updated: 14 August 2022; Ref: scu.80844

Girvan (Inspector of Taxes) v Orange Personal Communications Services Ltd: ChD 3 Apr 1998

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] STC 567

Statutes:

Income and Corporation Taxes Act 1988 64 70(1)

Jurisdiction:

England and Wales

Corporation Tax, Income Tax

Updated: 14 August 2022; Ref: scu.80848

Thin Cap Group Litigation, Test Claimants In v Revenue and Customs: ChD 17 Nov 2009

Judges:

Henderson J

Citations:

[2009] EWHC 2908 (Ch), [2009] BTC 754, [2010] STC 301, [2010] 1 CMLR 38, [2009] STI 3006

Links:

Bailii

Jurisdiction:

England and Wales

Citing:

Cited – Kleinwort Benson Ltd v Lincoln City Council etc HL 29-Jul-1998
Right of Recovery of Money Paid under Mistake
Kleinwort Benson had made payments to a local authority under swap agreements which were thought to be legally enforceable when made. Subsequently, a decision of the House of Lords, (Hazell v. Hammersmith and Fulham) established that such swap . .
Lists of cited by and citing cases may be incomplete.

European, Corporation Tax

Updated: 07 August 2022; Ref: scu.380256

Vodafone Cellular Ltd v Shaw (Inspector of Taxes): ChD 8 Mar 1995

A payment buying out technology royalties was not to be allowed against Corporation Tax. The cost of buying out a right to receive a revenue share was an income payment, not a capital payment.

Citations:

Times 08-Feb-1995, Ind Summary 20-Mar-1995, Gazette 08-Mar-1995

Jurisdiction:

England and Wales

Citing:

Cited – Mallalieu v Drummond HL 27-Jul-1983
The taxpayer was a barrister. To comply with Bar guidance on court dress, she wore, in court and in and to and from chambers black dresses, suits and shoes and white blouses. The clothing were perfectly ordinary articles suitable for everyday wear. . .

Cited by:

Appeal from – Vodafone Cellular Ltd v G Shaw (Her Majesty’s Inspector of Taxes) CA 20-Mar-1997
The court considered the application of the ‘exclusively’ test for expenditure which was sought to be set off against tax. Examining the leading modern cases, Millett LJ said: ‘the following propositions may be derived. (1) The words for the . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax

Updated: 06 August 2022; Ref: scu.90189

Hillsdown Holdings Plc and HF Meat and Foods Processing Pension Scheme Trustees Limited v Commissioners of Inland Revenue: ChD 13 May 1999

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:

England and Wales

Corporation Tax, Financial Services

Updated: 06 August 2022; Ref: scu.81384

Sun Life Assurance Society v Davidson: CA 1956

The phrase ‘general management’ extended further than ‘management’ and included what was done at the lower levels of a company’s executive structure.
Romer LJ said: ‘The ratio decidendi of Golder’s Case (Capital and National Trust Ltd. v. Golder (H.M. Inspector of Taxes)) (1949) 31 TC 265, as it seems to me, was that the phrase ‘expenses of management’, as used in s. 33 of the Income Tax Act, 1918, means, in effect, the expenses of the managers of a company (who would normally be the board of directors) and not the expenses incurred by the company in the general management of its business ; in other words, the phrase is directed to the expenses involved in shaping policy and in other matters of managerial decision and does not extend to expenses subsequently and consequently incurred at lower levels of the company’s executive structure.’

Judges:

Romer LJ

Citations:

[1956] 1 Ch 524

Jurisdiction:

England and Wales

Citing:

Applied – Norman v Golder (Inspector of Taxes) 1944
The court considered the nature of allowable expenses for an investment company: ‘the notion behind this Section may be thought to be that the expenditure is something which if you were looking at the profits and gains under Schedule D would be . .

Cited by:

Appeal from – Sun Life Assurance Society v Davidson HL 4-Jul-1957
The court considered the question of what was meant by the phrase ‘expenses of management’
Held: The phrase (s75) could be seen ‘as apt to cover the expenses which would normally be deductible in respect of its life assurance business if an . .
Cited – Atkinson (HM Inspector of Taxes) v Camas Plc CA 6-May-2004
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. . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax

Updated: 05 August 2022; Ref: scu.198421

Commission v Italy C-540/07: ECJ 16 Jul 2009

ECJ (Taxation) Failure of a Member State to fulfill obligations) Free movement of capital Article 56 EC Articles 31 and 40 of the EEA Agreement Direct taxation Withholding tax on outgoing dividends Deduction to the registered office of the beneficiary of the dividend under a preventive double taxation

Citations:

C-540/07, [2009] EUECJ C-540/07 – O

Links:

Bailii

Jurisdiction:

European

Cited by:

Opinion – Commission v Italy C-540/07 ECJ 19-Nov-2009
ECJ Failure of a Member State to fulfil obligations Free movement of capital Article 56 EC Articles 31 and 40 of the EEA Agreement Direct taxation Withholding at source on outgoing dividends Set-off at the place . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax

Updated: 03 August 2022; Ref: scu.374262

Dawsongroup Ltd v Revenue and Customs: FTTTx 9 Jun 2009

FTTTx CORPORATION TAX – de-listing of quoted company – whether costs of delisting allowable expense in corporation tax computation – whether company an ‘investment company’ – ICTA s 130 – no – whether costs ‘expenses of management’ – ICTA s 75 – no – appeal dismissed

Citations:

[2009] UKFTT 137 (TC)

Links:

Bailii

Jurisdiction:

England and Wales

Corporation Tax

Updated: 03 August 2022; Ref: scu.373677

Marks and Spencer Plc v Revenue and Customs: FTTTx 2 Apr 2009

FTTTx EUROPEAN LAW – group relief for losses of non-resident subsidiaries – whether there are no possibilities for those losses to be taken into account at the date of the group relief claim – no at the date of the original claims which are not valid claims, and yes on 20 March 2007 when the second claims were made — appeals allowed in principle

Citations:

[2009] UKFTT 64 (TC)

Links:

Bailii

Jurisdiction:

England and Wales

Corporation Tax

Updated: 03 August 2022; Ref: scu.373618

Vibroplant Ltd v Holland (HM Inspector of Taxes): CA 1980

The use of the buildings for servicing and repairing the plant which Vibroplant wished to hire out, was an essential part of Vibroplant’s business of plant hire operators and part of their trade. Although not required to decide the point, the court expressed a view as to whether the repair and servicing of the plant might constitute part of the business. He accepted that that activity might fall within the definition of ‘part of a trade’.

Judges:

Dillon J

Citations:

(1981) 54 TC 658, [1980] STC 671

Jurisdiction:

England and Wales

Cited by:

Cited – Revenue and Customs v Maco Door and Window Hardware (Uk) Ltd ChD 19-Jul-2006
The Revenue sought to disallow for industrial buildings allowance sums expended on warehouse premises which were to be used to store window products imported for use in other manufacturing processes.
Held: The Revenue’s appeal succeeded. ‘The . .
Cited – Maco Door and Window Hardware (UK) Ltd v Revenue and Customs HL 30-Jul-2008
The House was asked whether a warehouse used to store purchases made by the company from its parent company in Austria, was an ‘industrial building or structure’. It was agreed that the facility was used for the storage of materials for use in later . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax

Updated: 31 July 2022; Ref: scu.244482

Hoechst Finance Limited v Gumbrell: CA 1983

The issue was whether the appellant company, a member of an international group of trading companies, could recover as expenses of management a commission of 0.25% per annum it had to pay to its parent as the price of obtaining a guarantee for the issue of some guaranteed unsecured loan stock. The loan stock issue was made to raise finance for the other group companies operating within the United Kingdom.
Held: the commission was not an expense of management because it could not be severed from the cost of raising the finance. (Dillon LJ) ‘In the present case it seems to me that the guarantee had to be obtained by the company from its parent in order to raise the money to invest by advances to the other United Kingdom subsidiaries and the company had to agree to pay the parent the continuing commission in order to obtain the guarantee and therefore realistically as part of the price of raising the money. The commission cannot be severed from the cost of acquisition and so equally the annual payments of the commission cannot be severed from the cost of acquisition. It is unreal to regard each annual payment as merely a payment for the current year or the current six months to keep the guarantee on foot as part of the continuing management of the company’s business, because the whole obligation in respect of the loan stock and the obligation of the guarantee was undertaken once and for all when the stock was raised and the guarantee was entered into, and, as document 5 shows, the commission was charged by the parent company for giving the guarantee. It all relates back to the giving of the guarantee.’ (May LJ) ‘In my opinion, the result of that case is that in this type of situation one has to ask whether the relevant payment can be regarded as properly severable from the costs of acquisition of an investment or the issue of loan stock, on the one hand, or a direct and necessary part of the cost of a normal method of purchase or issue, on the other. If, posing that question, the answer is that it is the latter, then the payment is not an expense of management.’

Judges:

Dillon LJ, May LJ

Citations:

(1983) 56 TC 594

Jurisdiction:

England and Wales

Citing:

Cited – Sun Life Assurance Society v Davidson HL 4-Jul-1957
The court considered the question of what was meant by the phrase ‘expenses of management’
Held: The phrase (s75) could be seen ‘as apt to cover the expenses which would normally be deductible in respect of its life assurance business if an . .

Cited by:

Cited – Camas Plc v HM Inspector of Taxes ChD 7-Jul-2003
An investment company sought to set against its liability to corporation tax, the various costs of taking over another company. They argued that as an investment company these were not costs of the purchase and could be set against tax.
Held: . .
Cited – Atkinson (HM Inspector of Taxes) v Camas Plc CA 6-May-2004
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. . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax

Updated: 31 July 2022; Ref: scu.184473

DSG Retail Ltd and Others v Revenue and Customs (Rev 3): FTTTx 31 Mar 2009

FTTTx TRANSFER PRICING – captive insurance company insuring extended warranties for customers – whether business facilities provided at less than the arm’s length price under s 770 TA 1988 – yes – whether provision made differs from the arm’s length provision under Sch 28AA – yes

Citations:

[2009] UKFTT 31 (TC), [2009] STI 1604, [2009] STC (SCD) 397, [2009] UKFTT 00001 (TC)

Links:

Bailii

Corporation Tax

Updated: 30 July 2022; Ref: scu.373585

Vodafone 2 v HM Revenue and Customs: CA 22 May 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 requiring domestic legislation, where appropriate, to accord with European legislation it was intended to implement, saying: ‘the obligation on the English courts to construe domestic legislation consistently with Community law obligations is both broad and far-reaching. In particular: (a) it is not constrained by conventional rules of construction . . (b) it does not require ambiguity in the legislative language . . ; c) it is not an exercise in semantics or linguistics . . ; (d) it permits departure from the strict and literal application of the words which the legislature has elected to use . . ; (e) it permits the implication of words necessary to comply with Community law obligations . . ; and (f) the precise form of the words to be implied does not matter . . ‘ and ‘The only constraints on the broad and far-reaching nature of the interpretative obligation are that: (a) the meaning should go with the grain of the legislation and be compatible with the underlying thrust of the legislation being construed . .’

Judges:

Sir Andrew Morritt, Chancellor, Lord Justice Longmore and Lord Justice Goldring

Citations:

[2009] EWCA Civ 446, [2009] BTC 273, [2010] Eu LR 110, [2010] Bus LR 96, [2010] 2 WLR 288, [2009] STI 1795, [2010] Ch 77, [2009] STC 1480

Links:

Bailii, Times

Statutes:

Income and Corporation Taxes Act 1988 748(1)(a)

Jurisdiction:

England and Wales

Cited by:

Cited – Robertson v Swift SC 9-Sep-2014
Notice Absence did not Remove Right to Cancel
The defendant had contracted to arrange the removal of the claimant’s household goods on moving house. The claimant cancelled the contract, made at his housel, but refused to pay the cancellation fee, saying that the contract not having been made at . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax, European

Updated: 26 July 2022; Ref: scu.346307

NEC Semi-Conductors Limited and Other Test Claimants v The Commissioners of Inland Revenue: ChD 24 Nov 2003

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 lacked jurisdiction to decide some of the claims or had a discretion to accept or decline jurisdiction since he would decline to exercise whatever jurisdiction he might have. The most important factor was that ‘whether it would be more convenient to commence the entire case in the High Court or not, that is not the system our law provides for the resolution of tax disputes between taxpayers and the Revenue.’ It was not ‘a major inconvenience’ to have two sets of proceedings when they would proceed sequentially and not simultaneously, with the High Court proceedings claiming consequential relief going ahead only if the taxpayers were successful in the proceedings before the special commissioners.

Judges:

The Hon Mr Justice Park

Citations:

[2003] EWHC 2813 (Ch), Gazette 29-Jan-2004, [2004] STC 594

Links:

Bailii

Statutes:

Income and Corporation Taxes Act 1988 247

Jurisdiction:

England and Wales

Citing:

See Also – Marks and Spencer Plc v Halsey (Inspector of Taxes) 2003
Marks and Spencer Plc appealed against the refusal of group relief, on the ground that the statutory limitations on the territorial scope of group relief were incompatible with, and overridden by, Community law. The Special Commissioners dismissed . .
See Also – Claimants under the Loss Relief Group Litigation Order v Inland Revenue Commissioners ChD 3-Mar-2004
Various claimants sought to have issues of law on group relief and other issues settled under a group litigation order.
Held: The High Court had no jurisdiction to hear such matters until they had first been raised in ordinary tax appeals . .

Cited by:

At first instance – Autologic Holdings Plc and others v Commissioners of Inland Revenue HL 28-Jul-2005
Taxpayer companies challenged the way that the revenue restricted claims for group Corporation Tax relief for subsidiary companies in Europe. The issue was awaiting a decision of the European Court. The Revenue said that the claims now being made by . .
Appeal from – Loss Relief Group, Test Claimants In v Inland Revenue CA 28-May-2004
The taxpayers sought determination by the court of their various claims for group tax relief. The High Court had declined jurisdiction.
Held: The appeal was allowed. The judge’s attitude was one which would perhaps appeal to most lawyers . .
See Also – Claimants under the Loss Relief Group Litigation Order v Inland Revenue Commissioners ChD 3-Mar-2004
Various claimants sought to have issues of law on group relief and other issues settled under a group litigation order.
Held: The High Court had no jurisdiction to hear such matters until they had first been raised in ordinary tax appeals . .
Cited – Boake Allen Ltd and others v HM Revenue and Customs CA 31-Jan-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: . .
Cited – Test Claimants In The Franked Investment Income Group Litigation v Inland Revenue SC 23-May-2012
The European Court had found the UK to have unlawfully treated differently payment of franked dividends between subsidiaries of UK companies according to whether all the UK subsidiaries were themselves UK based, thus prejudicing European . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax, Taxes Management

Updated: 26 July 2022; Ref: scu.188282

Regina v Inland Revenue Commissioners Ex Parte Unilever Plc and Others: QBD 12 Sep 1994

The Inland Revenue is to notify taxpayer of a change in acquiescence in practice to late payment.

Citations:

Ind Summary 12-Sep-1994

Jurisdiction:

England and Wales

Cited by:

Appeal from – Regina v Commissioners of Inland Revenue, ex parte Unilever plc CA 1996
The Revenue had refused to exercise a discretion in favour of the taxpayer in the same form it had granted for over twenty years. The taxpayer complained that this was unfair.
Held: The new approach to late applications, brought in without any . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax, Administrative

Updated: 23 July 2022; Ref: scu.86940

Elliss v BP Oil Northern Ireland Refinery Ltd: CA 1987

The company had incurred capital expenditure in machinery and plant for trading before 1972. The 1975 Act prevented them claiming the expenditure as losses, and they sought to carry them forward to 1973 when additional claims were possible. The Revenue said that the allowances had to be claimed in the periods incurred.
Held: The Crown’s appeal failed. The legislation did not oblige companies to take the allowances in the year as suggested.

Citations:

[1987] 1 FTLR 253, [1987] STC 52

Statutes:

Finance Act (No 2) 1975 2

Jurisdiction:

England and Wales

Cited by:

Cited – Smith v Secretary of State for Work and Pensions and Another HL 12-Jul-2006
The House considered whether under the 1992 Regulations a self-employed parent could use for his child support calculation his net earnings as declared to the Revenue, which would allow deduction of capital and other allowances properly claimed . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax

Updated: 21 July 2022; Ref: scu.243092

Etat belge SPF Finances v Les Vergers Du Vieux Tauves: ECJ 3 Jul 2008

ECJ Opinion – Directive 90/435 Parent company Holder of right of usufruct over shares.

Judges:

Sharpston AG

Citations:

C-48/07, [2008] EUECJ C-48/07 – O

Links:

Bailii

Statutes:

Directive 90/435

Cited by:

Opinion – Etat belge SPF Finances v Les Vergers Du Vieux Tauves ECJ 22-Dec-2008
ECJ Corporation taxes – Directive 90/435/EEC – Status of parent company Capital holding Holding of shares in usufruct . .
Lists of cited by and citing cases may be incomplete.

European, Corporation Tax

Updated: 17 July 2022; Ref: scu.270883

The Test Claimants In The FII Group Litigation v HM Revenue and Customs: ChD 18 Dec 2014

The company claimants had paid large sums in excess tax under a mistake of European law.

Judges:

Henderson J

Citations:

[2014] EWHC 4302 (Ch), [2015] BTC 3, [2015] STI 49, [2015] STC 1471

Links:

Bailii

Statutes:

Value Added Tax Act 1994 94

Jurisdiction:

England and Wales

Citing:

See Also – Test Claimants In The FII Group Litigation v CIR ECJ 12-Dec-2006
ECJ (Opinion of Geelhoed AG) Interpretation of Articles 43 and 56 EC and Articles 4(1) and 6 of Council Directive 90/435/EEC of 23 July 1990 on the common system of taxation applicable in the case of parent . .
See Also – Test Claimants In the FII Group Litigation v HM Revenue and Customs ChD 27-Nov-2008
The claimants were companies with parent companies in the UK and other subsidiaries not so resident, both in the EU and outside. They complained of the differences in treatment under corporation tax of the payment of dividends between the . .
See Also – Test Claimants In The FII Group Litigation v The Commissioners For Her Majesty’s Revenue and Customs ECJ 19-Jul-2012
ECJ Articles 49 TFEU and 63 TFEU – Payment of dividends – Corporation tax – Case C-446/04 – Test Claimants in the FII Group Litigation – Interpretation of the judgment – Prevention of economic double taxation – . .
See Also – Test Claimants In The FII Group Litigation v Commissioners of Inland Revenue ECJ 5-Sep-2013
ECJ Opinion – Recovery of national taxes which are contrary to European Union law – Limitation period for instituting proceedings – National legislation curtailing the limitation period with retroactive effect . .
See Also – Test Claimants In The FII Group Litigation v Commissioners of Inland Revenue ECJ 12-Dec-2013
ECJ Judicial protection – Principle of effectiveness – Principles of legal certainty and the protection of legitimate expectations – Restitution of sums paid but not due – Remedies – National legislation – . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax, European

Updated: 17 July 2022; Ref: scu.540253

Revenue and Customs v Dundas Heritable Ltd: UTTC 2 Jul 2019

CORPORATION TAX — capital allowances – time limit for claims – Finance Act 1998, Schedule 18, paragraph 82 – claims for capital allowances submitted more than 12 months after filing dates – notice of enquiry given – whether claims timeous because submitted before enquiry completed – yes – appeal refuse

Citations:

[2019] UKUT 208 (TCC)

Links:

Bailii

Jurisdiction:

England and Wales

Corporation Tax

Updated: 14 July 2022; Ref: scu.639528

HM Revenue and Customs v Holland and Another: ChD 24 Jun 2008

The Revenue sought to recover from the defendant substantial sums in respect of allegedly unlawful dividends paid from an insolvent company. They said that the defendant and his wife were de facto directors.
Held: Claims agains the second defendant were dismissed. Claims for early periods were rejected under section 727 of the 1985 Act, but succeeded otherwise. The defendant had been guilty of misfeasance and breach of duty in causing their payment.

Judges:

Mark Cawson QC

Citations:

[2008] EWHC 2200 (Ch), [2008] STC 3142, [2008] 2 BCLC 613, [2009] BCC 37, [2008] STI 1642, [2009] Bus LR 1

Links:

Bailii

Statutes:

Insolvency Act 1986 212, Companies Act 1985 727

Jurisdiction:

England and Wales

Cited by:

Appeal from – Holland v Revenue and Customs and Another CA 2-Jul-2009
The appellant supported IT workers. Through his own company, he set up companies in which his company was a director, and which companies in turn employed the IT workers securing substantial savings in higher rate Corporation Tax.
Held: The . .
At First Instance – Holland v Revenue and Customs and Another SC 24-Nov-2010
The Revenue sought an order under section 212 of the 1986 Act, for payment of the tax debts of the insolvent company by a de facto director. H had organised a scheme under which IT contractors had worked through companies created by him under a . .
Lists of cited by and citing cases may be incomplete.

Insolvency, Corporation Tax, Company

Updated: 13 July 2022; Ref: scu.276668

Prudential Plc v Revenue and Customs: SCIT 11 Sep 2007

SCIT QUALIFYING CONTRACTS – Profits and losses – Front end payments under currency contracts – Whether qualifying payments – No – Whether to be allocated such that payments are included as ‘amounts B’ – No – Whether currency contracts were entered into for unallowable purposes – Yes – Appeal dismissed – FA 1994 ss 151, 155 and 168A.

Citations:

[2007] UKSPC SPC00636

Links:

Bailii

Statutes:

Finance Act 1994 151 155 168A

Jurisdiction:

England and Wales

Corporation Tax

Updated: 12 July 2022; Ref: scu.262395

Lingfield Park (1991) Limited v Shove: CA 31 Mar 2004

The taxpayers sought capital allowances on the costs of installing an artificial all-weather race track.
Held: The track was not either plant or machinery, and the taxpayer was not eligible for the relief. The only reasonable conclusion was that the AWT operated as the premises.

Judges:

Lord Justice Mummery Lord Justice Potter Lord Justice Scott Baker

Citations:

[2004] EWCA Civ 391, Times 26-Apr-2004

Links:

Bailii

Statutes:

Capital Allowances Act 1990

Jurisdiction:

England and Wales

Citing:

Cited – Inland Revenue Commissioners v Scottish and Newcastle Breweries Ltd HL 4-Mar-1982
Expenditure on refurbishment, decor and fittings in hotels was held to be plant though forming part of the setting of the hotels. The House considered the interpretation of undefined expressions in fiscal legislation, such as ‘trade’, ‘income’, . .
Cited – Anchor International Ltd v Inland Revenue SCIT 16-Jan-2003
An installation of a synthetic grass turf ‘carpet’ for five-a-side football pitches was plant, since it was not a fixed structure. It was ‘the means by which the appellant generates profits rather than merely the setting.’ . .
Cited – Gray (Inspector of Taxes) v Seymours Garden Centre (Horticulture) CA 31-May-1995
A ‘Planteria’ for the growing and storage of plants pending sale was premises, or a building, and not plant; no allowance was available. In considering the appeal, ‘the question for this Court, as it was for the Judge, is whether the facts found by . .
Cited – Inland Revenue Commissioners v Barclay Curle and Co Ltd 1969
Even a large structure used for the purposes of the trade may be capable of being plant. In this case a dry dock was used in trade of ship builders, ship repairers and marine engineers. . .
Cited – Wimpy International Ltd v Warland 1988
Expenditure on modernising restaurants with shop fronts, floor and wall tiles, wall finishes, suspended ceilings, raised floors, fire doors and fire proofings was held not to be plant. The court asked what marks indicate that a structure premises of . .
Cited – Carr v Sayer 1992
The taxpayer claimed capital allowances for expenditure on purpose built permanent quarantine kennels.
Held: It was not expenditure on plant. To decide whether a structure is plant so as to qualify for capiltal allowances, the question is . .
Cited – H M Inspector of Taxes (Atwood) v Anduff Car Wash Limited CA 17-Jul-1997
Capital allowances.
The taxpayer operated automatic car wash sites. It claimed capital allowances for the entirety of a wash hall, housed within a building incorporating washing machinery and control equipment, and surrounded by tarmac areas . .
Cited – Cooke v Beach Station Caravans Ltd 1974
The excavation and construction of 2 swimming pools in a caravan park was held to be the provision of plant, not premises or setting. . .
Cited – Benson v Yard Arm Club Ltd 1979
The purchase and conversion of a vessel and barge to be used as permanently moored floating restaurant was held not to be the provision of plant to attract allowances. . .
Lists of cited by and citing cases may be incomplete.

Corporation Tax

Updated: 12 July 2022; Ref: scu.195031