The Trustees of an exempt approved pension scheme bought shares, and sold them at a lower price to the company. Under the 1988 Act, this operated to create a tax credit. The revenue issued a notice and assessment under Schedule F to defeat that tax credit. The trustees successfully appealed that to the Commissioners, and the Revenue appealed in turn.
Held: The sum received by the trustees was by way of an ‘abnormal dividend’ within section 704A. The condition of Part XVII were satisfied, and the revenue were right to treat it under tax-avoidance provisions. The notice and assessment were re-instated.
Mr Justice Lightman
England and Wales
Appeal from – Inland Revenue Commissioners v Sema Group Pension Scheme Trustees CA 19-Dec-2002
The taxpayers appealed a notice under section 703(3) to counteract the tax advantage received by them from a share buy-back scheme. The scheme was an approved pension scheme, under which the quoted company agreed to buy back its own shares.
Lists of cited by and citing cases may be incomplete.
Updated: 28 April 2022; Ref: scu.168074