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:

CitedInland 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 . .
CitedGreenberg 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 . .
CitedInland 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 fromHer 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