The act provided that any payment not chargeable to income tax was to be treated as a capital payment. The settlor had created an off-shore trust in which he retained a determinable life interest, and had received unsecured and interest free loans from the trustees. The loans were repayable on demand, and it was argued that accordingly, the value actually conferred was negligible. It was held that the section created one simple answer to a huge variety of possible situations. Though artificial and not without difficulties, the construction that he had received capital payments stood, and they were taxable accordingly.
Judges:
Aldous, Walker, Parker LJJ
Citations:
Times 16-Jul-2001, Gazette 09-Aug-2001, [2001] EWCA Civ 1041
Links:
Statutes:
Taxation of Chargeable Gains Act 1992 87(2) 97(4)
Jurisdiction:
England and Wales
Capital Gains Tax
Updated: 19 May 2022; Ref: scu.79481