Cross loans were made between an investment company and pension schemes. The overall effect was to create payments which could be set off against Corporation Tax. They were not a pre-ordained series of transactions where the underlying loans were genuine, and the payments were made in respect of a genuine accrual of interest.
Citations:
Times 26-Oct-1998, Gazette 18-Nov-1998, [2001] 2 WLR 377, [1998] EWCA Civ 1608
Statutes:
Income and Corporation Taxes Act 1988 338
Jurisdiction:
England and Wales
Citing:
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 – McNiven (Inspector of Taxes) v Westmoreland Investments Ltd ChD 19-Aug-1997
Loans made between associated companies for the sole purpose of creating a charge to tax were ineffective as avoidance scheme. . .
Cited by:
Cited – 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 . .
At CA – MacNiven (Inspector of Taxes) v Westmoreland Investments Ltd HL 15-Feb-2001
The fact that a payment of interest was made only to create a tax advantage did not prevent its being properly claimed. Interest was paid for the purposes of setting it against tax, when the debt was discharged. A company with substantial losses had . .
Lists of cited by and citing cases may be incomplete.
Corporation Tax, Income Tax, Taxes Management
Updated: 25 November 2022; Ref: scu.83580
