The pension scheme had been approved, but that approval later withdraw. HMRC issued assessment for the years in which it had been approved. The taxpayer argued that such assessments applied to the date with effect from which the approval is withdraw, HMRC contended that it was in the year in which withdrawal was notified. The taxpayer appealed from decisions against its position.
Held: (Lord Carnwath and Hodge dissenting) The appeal was allowed. The Inland Revenue were not entitled to assess the administrator of the John Mander Pension Scheme to tax under section 591C of the Income and Corporation Taxes Act 1988 for the year 2000-2001.
Held: The taxpayer’s appeal failed: ‘It is inherent in the process of assessment that a taxpayer may be assessed to tax on profits or gains that arose in a charging period earlier than that in which the assessment was raised. This occurs whenever tax is assessed in arrears. The period of retrospectivity may be considerable if profits or gains for an earlier period were previously overlooked or wrongly thought not to be chargeable to tax. But it may also occur when something happens which makes it necessary to recharacterise the taxpayer’s financial affairs in an earlier period. Before this state of affairs can be regarded as anomalous, we need to ask ourselves what the recharacterisation involves. It would be surprising if the law allowed a tax to be charged in an earlier period by reference to criteria which did not apply until a later one. On the other hand, it may involve no more than a recognition of facts which always existed.’
Lord Neuberger, President , Lord Sumption , Lord Reed , Lord Carnwath , Lord Hodge
[2015] 4 All ER 896, [2015] WLR(D) 356, [2015] UKSC 56, [2015] 1 WLR 3857, [2015] BTC 25, [2015] STC 2231, [2015] STI 2530, UKSC 2014/0052
WLRD, Bailii, Bailii Summary, SC, Sc Summary
Income and Corporation Taxes Act 1988, Taxes Management Act 1970 34
England and Wales
Citing:
At FTTTx – John Mander Pension Trustees Ltd v Revenue and Customs FTTTx 28-Oct-2011
FTTTx Income tax – charge on retirement benefits scheme administrator under s591C ICTA 88 on cessation of approval of scheme – whether notice validly given – whether assessments valid – whether raised in respect . .
At UTTC – John Mander Pension Trustees Ltd v Revenue and Customs – FTC/88/2011 UTTC 28-Jan-2013
UTTC Income tax – charge on retirement benefits scheme administrator under s591C ICTA 88 on cessation of approval of scheme – whether assessments raised in respect of correct year of assessment – whether raised . .
Appeal from – John Mander Pension Scheme Trustees Ltd v Revenue and Customs CA 19-Dec-2013
The court was asked whether the Commissioners for Her Majesty’s Revenue and Customs have assessed the appellant for tax in the wrong tax year. The scheme had ceased to be approved, and HMRC issued assessments for the earlier years in which the . .
Cited – Spence v Inland Revenue Commissioners IHCS 1941
The taxpayer had sold shares to a third party in 1933 under a contract which he came to say had been induced by fraud. In 1939 he obtained a judgment reducing the contract, with effect from the date that it was made, together with orders that the . .
Cited – Morley-Clarke v Jones (Inspector of Taxes) CA 1986
In 1969 an order had been made in divorce proceedings for the payment by the husband to the wife of a sum by way of maintenance for their child. In 1979 the order was varied with effect from the date of the original order, so as to make the sum . .
Cited – West v Gwynne CA 1911
The plaintiffs were assignees of a lease dating from 1874. The lease contained a covenant by the lessees against underletting the premises or any part thereof without the consent in writing of the landlord. Under the Act, landlords could no longer . .
Cited – Greenberg v Inland Revenue Commissioners HL 20-Jul-1971
HL Surtax – Tax advantage – Counteraction – Contracts made before 5th April 1960 for forward dividend-strip – Purchase money released to vendor after that date as and when dividends paid – Whether tax advantage . .
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 – 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 . .
Lists of cited by and citing cases may be incomplete.
Income Tax
Updated: 03 January 2022; Ref: scu.550794