ECJ Freedom of Establishment – Parent-Subsidiary Directive – Tax Legislation : Judgment – Reference for a preliminary ruling – Freedom of establishment – Parent-Subsidiary Directive – Tax legislation – Tax on company profits – Distribution of dividends – Withholding tax – Double taxation – ‘Fairness tax’
C-68/15, [2017] EUECJ C-68/15, ECLI:EU:C:2017:379
European
Updated: 26 March 2022; Ref: scu.584355
FTTTx (Income Tax/Corporation Tax : Penalty) Corporation tax – closure notice and penalty -understated profits – whether deliberate and concealed – appeal dismissed.
[2017] UKFTT 248 (TC)
England and Wales
Updated: 24 March 2022; Ref: scu.581688
ECJ (Judgment) Reference for a preliminary ruling – Parent companies and subsidiaries established in different Member States – Common system of taxation applicable – Corporation tax – Directive 90/435/EEC – Scope – Article 2(c) – Company subject to tax without the possibility of an option or of being exempt – Taxation at a zero rate
ECLI:EU:C:2017:180, [2017] EUECJ C-448/15
European
Updated: 23 March 2022; Ref: scu.580727
Judgment – Reference for a preliminary ruling – Freedom of establishment – Corporation tax – Tax relief – Groups of companies and consortia – National legislation permitting losses to be transferred between a company belonging to a consortium and a company that is a member of a group which are connected by a ‘link company’ that is a member of both the group and the consortium – Residence condition for the ‘link company’ – Discrimination on the basis of where the corporate seat is located – Ultimate group parent company established in a third State and owning the companies which are seeking to transfer losses through companies established in third States
[2014] EUECJ C-80/12, [2014] STC 1489, ECLI:EU:C:2014:200, [2014] BTC 19, [2014] STI 1630
European
Opinion – Felixstowe Dock and Railway Company Ltd v The Commissioners For Her Majesty’s Revenue And Customs ECJ 24-Oct-2013
ECJ Opinion – Interpretation of Articles 43 EC and 48 EC – Freedom of establishment – Tax legislation – Corporation tax – Tax relief – Consortium claim for group relief (consortium relief) – National legislation . .
Reference – The Felixstowe Dock and Railway Company Ltd and Others v Revenue and Customs FTTTx 19-Dec-2011
Corporation tax – joint referral – FA 1998, Sch 18, para 31A – group relief – consortium – surrendering company indirectly partly owned by Luxembourg company – condition that ‘link company’ must be UK resident or carry on a trade in the UK through a . .
Lists of cited by and citing cases may be incomplete.
Updated: 23 March 2022; Ref: scu.580683
(Income Tax/Corporation Tax : Losses) CORPORATION TAX – Change in local currency – Whether accounts comply with UK generally accepted accounting practice – Yes – Whether exchange differences are ‘exchange losses’ – Yes – Whether exchange differences ‘fairly represent’ a loss – Yes – Appeal allowed
[2017] UKFTT 151 (TC)
England and Wales
Updated: 06 February 2022; Ref: scu.578544
FTTTx (Income Tax/Corporation Tax : Other) COSTS REGIME – complex appeal – whether opt out made in time – whether discretion should be exercised to extend time for opt out
[2017] UKFTT 194 (TC)
England and Wales
Updated: 06 February 2022; Ref: scu.578535
ECJ Judgment – Reference for a preliminary ruling – Freedom of establishment – Tax legislation on the under-capitalization of subsidiaries – Inclusion in the taxable profits of a company lending interest on loans paid by a non-resident borrowing subsidiary – Exemption from interest paid by a subsidiary Resident borrowing subsidiary – Equitable distribution of the power to tax between Member States – Need to prevent the risk of tax evasion
C-593/14, [2016] EUECJ C-593/14
Bailii
European
Corporation Tax
Updated: 27 January 2022; Ref: scu.572595
ECJ Judgment – Appeal – State aid – Article 107 (1) TFEU – Taxation – Company tax – Deduction – Amortization of goodwill arising from at least 5% equity participation by undertakings domiciled in Spain Undertakings domiciled outside that Member State – Concept of ‘State aid’ – Condition relating to selectivity
C-20/15, [2016] EUECJ C-20/15
Bailii
European
Corporation Tax
Updated: 27 January 2022; Ref: scu.572573
ECJ (Judgment) Reference for a preliminary ruling – Free movement of capital – Articles 63 to 65 TFEU – EC-Tunisia Association Agreement – Articles 31, 34 and 89 – EC-Lebanon Association Agreement – Articles 31, 33 and 85 – Corporation tax – Dividends received by a company established in the Member State of the beneficiary company – Dividends received from a company established in a non-member State which is party to the association agreement – Difference of treatment – Restriction – Justification – Efficacy of fiscal supervision – Possibility of relying on Article 64 TFEU in relation to the EC-Tunisia and EC-Lebanon association agreements
C-464/14, [2016] EUECJ C-464/14
Bailii
European
Corporation Tax
Updated: 26 January 2022; Ref: scu.571882
Corporation Tax – Research and Development
[2016] UKFTT 746 (TC)
Bailii
England and Wales
Corporation Tax
Updated: 26 January 2022; Ref: scu.571840
Corporation Tax – Whether Payments Made
[2016] UKFTT 765 (TC)
Bailii
England and Wales
Corporation Tax
Updated: 26 January 2022; Ref: scu.571829
Corporation Tax – Failure To File Returns On Time
[2016] UKFTT 751 (TC)
Bailii
England and Wales
Corporation Tax
Updated: 26 January 2022; Ref: scu.571838
FTTTx CORPORATION TAX -out of time appeal against assessment – appellant claimed the collapse in the property market and the inability to raise funds meant it could not deal with its tax affairs properly- permission to appeal dismissed
[2010] UKFTT 617 (TC)
Bailii
England and Wales
Corporation Tax
Updated: 20 January 2022; Ref: scu.567569
FTTTx Corporation Tax – Assessment to recover excess group relief – Paragraph 76 Sch 18 FA 1998 – Whether a discovery assessment – No – Whether assessment subject to paragraphs 42-45 Sch 18 FA 1998 – No – Whether agreement under s.54 TMA 1970 – No – Appeal dismissed
[2010] UKFTT 554 (TC), [2011] SFTD 186, [2011] STI 377
Bailii
England and Wales
Corporation Tax
Updated: 20 January 2022; Ref: scu.567563
Corporation Tax – small companies’ relief – loan creditor – associated company – Appeal dismissed.
[2010] UKFTT 550 (TC)
Bailii
England and Wales
Corporation Tax
Updated: 20 January 2022; Ref: scu.567538
UTTC Corporation Tax – para 33 Sch 18 FA 98 – application for closure notice – discovery assessment made before enquiry opened – settled by agreement under s 54 Taxes Management Act 1970 – effect of settlement on scope and possible conclusions of enquiry – Olin v Scorer considered
[2016] UKUT 105 (TCC)
Bailii
England and Wales
Corporation Tax
Updated: 14 January 2022; Ref: scu.562431
Income Tax/Corporation Tax : Employment Income
[2016] UKFTT 58 (TC)
Bailii
England and Wales
Corporation Tax
Updated: 10 January 2022; Ref: scu.559941
Income Tax/Corporation Tax : Assessment/Self-Assessment
[2016] UKFTT 13 (TC)
Bailii
England and Wales
Corporation Tax
Updated: 10 January 2022; Ref: scu.559884
Corporation tax – Chargeable gains – Disposal of shares acquired in consideration of issue of new share – Whether amount or value of consideration the agreed issue price or other value – Income and Corporation Taxes Act 1970, ss 21 and 265 – Finance Act 1965, Sch 6, para 4(l)(a) – Finance Act 1971, Sch 10, para 10.
[1982] UKHL TC – 55 – 286, [1982] Com LR 198, [1982] 2 All ER 942, [1983] 1 AC 501, [1982] 3 WLR 214, 55 TC 286, [1982] STC 585
Bailii
England and Wales
Corporation Tax
Updated: 10 January 2022; Ref: scu.559776
The amount of loss available to a company for surrender was restricted to trading losses or capital allowances, and was not to include allowable losses. The sums to be surrendered were those which might appear in a calculation of profits for the period. Therefore allowable losses from previous years activities were not to be brought forward for deduction against chargeable gains.
Rattee J
Times 12-Jun-2001, [2002] STC 430
Income and Corporation Taxes Act 1988 403 (7)
England and Wales
Citing:
Appealed to – Taylor (Inspector of Taxes) v MEPC Holdings Ltd CA 20-Jun-2002
The taxpayer sought to include in the amounts to be set off by surrender against the group’s liability for corporation tax, chargeable gains in respect of allowable losses of a preceding accounting period. They appealed a decision against them at . .
Cited by:
Appeal from – Taylor (Inspector of Taxes) v MEPC Holdings Ltd CA 20-Jun-2002
The taxpayer sought to include in the amounts to be set off by surrender against the group’s liability for corporation tax, chargeable gains in respect of allowable losses of a preceding accounting period. They appealed a decision against them at . .
Lists of cited by and citing cases may be incomplete.
Corporation Tax
Updated: 09 January 2022; Ref: scu.89732
Income Tax/Corporation Tax : Penalty
[2015] UKFTT 169 (TC)
Bailii
England and Wales
Corporation Tax
Updated: 30 December 2021; Ref: scu.547389
UTTC CORPORATION TAX – appeal in FTTx against amendments made by closure notices – jurisdiction – claim for terminal loss relief – denied in closure notices relating to other years – whether jurisdiction to consider the appeal – no – appeal to Upper Tribunal dismissed
[2014] UKUT 488 (TCC), [2014] BTC 529, [2015] STC 563
Bailii
England and Wales
Corporation Tax
Updated: 24 December 2021; Ref: scu.539406
CORPORATION TAX – self assessment – enquiry notice given on anniversary date of day on which return filed – whether notice given within 12 months of day when return filed – meaning of word ‘from’ in para 24(2) Sch 18 FA 1998 – held, ‘from’ excluded day when filed – notice therefore validly given – as a result, taxpayer notice under para 1 Sch 36 FA 2008 validly given as Condition A in para 21(4) fulfilled – appeal dismissed and direction given to supply information as specified in Sch 36 notice
[2014] UKFTT 943 (TC)
Bailii
England and Wales
Corporation Tax
Updated: 22 December 2021; Ref: scu.537671
CORPORATION TAX – Loss relief – Yacht chartering business carried out on a commercial basis – Whether it was also carried out with a view to the realisation of profits of trade in the accounting periods for the years ended 31 March 2009 and 2010 (as required by s 393A (3) and (4) of the Income and Corporation Taxes Act 1988) and accounting periods for the years ended 31 March 2011 and 2012 (as required by s 44 Corporation Taxes act 2010) – Yes – Appeal allowed
[2014] UKFTT 686 (TC)
Bailii
England and Wales
Corporation Tax
Updated: 17 December 2021; Ref: scu.535138
CORPORATION TAX – whether penalty imposed by Formula One governing body for breach of its non-statutory code deductible in computing profits to be charged to corporation tax – held no – appeal allowed
[2014] UKUT 269 (TCC)
Bailii
England and Wales
Corporation Tax
Updated: 17 December 2021; Ref: scu.534519
CORPORATION TAX – loan relationship – assignment of right to interest under the loan to another group company – effect of assignment on recognition of loan in accounts of assignor company – proper application of loan relationship provisions to the assignee company
[2014] UKUT 178 (TCC)
Bailii
England and Wales
Corporation Tax
Updated: 03 December 2021; Ref: scu.525883
Flat rate Penalties imposed for late filing of Company Tax Returns – reasonable excuse – appeal dismissed and penalties upheld
[2014] UKFTT 340 (TC)
Bailii
England and Wales
Corporation Tax
Updated: 03 December 2021; Ref: scu.525330
ECJ Free movement of capital – Tax legislation – Corporation tax – Interest paid by a resident company on funds lent by a company established in a non-member country – Existence of ‘special relations’ between those companies – Thin capitalisation rules – No right of deduction in relation to interest on the part of the overall debt regarded as excessive – Interest deductible if paid to a company resident in the national territory – Tax evasion and avoidance – Wholly artificial arrangements – Arm’s length terms – Proportionality
ECLI:EU:C:2013:629, [2013] EUECJ C-282/12
Bailii
European
Corporation Tax
Updated: 11 November 2021; Ref: scu.516348
‘This judgment is about the tax effectiveness of a ‘rate-boosting’ scheme (‘the Scheme’), that is, a scheme to boost claims to double tax credit relief (‘DTR’) in the hands of a UK parent company (‘the UK ultimate parent’) on a dividend (‘a Case V dividend’) received by it from any of its overseas subsidiaries and originating from another UK resident company (‘the UK subsidiary’). A Case V dividend is taxable under Case V of schedule D to the Income and Corporation Taxes Act 1988 (‘ICTA’). The UK ultimate parent is entitled to credit for foreign tax suffered by the paying company (‘the paying subsidiary’) and its subsidiaries.’
Arden. Kitchin, Jackson LJJ
[2016] EWCA Civ 468
Bailii
England and Wales
Corporation Tax
Updated: 10 November 2021; Ref: scu.564449
The second claimant claimed restitution from the defendants in respect of United Kingdom corporation tax unlawfully charged on certain dividends paid to it by a wholly-owned subsidiary incorporated and resident in the Netherlands.
Henderson J
[2016] EWHC 2426 (Ch)
Bailii
England and Wales
Corporation Tax
Updated: 02 November 2021; Ref: scu.569929
Taxpayer companies challenged the way that the revenue restricted claims for group Corporation Tax relief for subsidiary companies in Europe. The issue was awaiting a decision of the European Court. The Revenue said that the claims now being made by other companies should proceed through the Commissioners who could implement European law directly. The taxpayers challenged their jurisdiction to hear certain claims.
Held: Where the Commissioners had jurisdiction, the taxpayers had an obligation to take their claims to the Commissioners.
Where the time limit for use of the statutory scheme had not expired, a taxpayer’s only way of challenging a taxing provision as contrary to European law was by making use of the statutory tribunal scheme, as opposed to judicial review.
Lord Nicholls of Birkenhead said: ‘Underlying this conclusion is a point of general policy concerning cases where an applicant claims he has been wrongly deprived of benefits to which he is entitled under directly applicable provisions of Community law. Where Parliament has assigned to a specialist tribunal responsibility for adjudicating on disputes over the payment of such benefits, and an application to that tribunal is not time-barred, in the ordinary course the primary remedy for non-receipt of such benefits is to have recourse to that tribunal. That tribunal will give effect to the applicant’s rights under directly enforceable provisions of Community law as well as his rights under domestic law. The tribunal will afford him the benefits to which he is properly entitled. In such cases, where that course is still available to an applicant, claims in the High Court founded on an alleged breach of Community law will not normally be appropriate.’
Lord Millett said that ‘the computation of a taxpayer’s taxable profits for the purpose of determining his liability to tax is within the exclusive jurisdiction of the commissioners’
Lord Walker of Gestingthorpe referred to: ‘the general principle embodied in tax law before self-assessment, that any dispute with the revenue about an individual’s liability to income tax or a company’s liability to corporation tax is to be determined in the first instance by the general commissioners or the special commissioners.’
Lord Nicholls of Birkenhead, Lord Steyn, Lord Hope of Craighead, Lord Walker of Gestingthorpe
[2005] UKHL 54, Times 01-Aug-2005, [2005] 3 CMLR 2, [2005] STC 1357, [2005] STI 1336, [2006] 1 AC 118, [2005] 3 WLR 339, [2005] 4 All ER 1141, [2005] BTC 402, [2006] Eu LR 131, 77 TC 504
Bailii, House of Lords
England and Wales
Citing:
Cited – Imperial Chemical Industries v Colmer ECJ 16-Jul-1998
A member state was not allowed to impose a tax regime which discriminated against the subsidiaries of a company based in that state where they were based in other member states, but discrimination was allowed where the subsidiaries were based . .
Cited – Metallgesellschaft Ltd and Others v Inland Revenue Commissioners and Another Hoechst Ag and Another v Same ECJ 8-Mar-2001
The British law which meant that non-resident parent companies of British based businesses were not able to recover interest on payments of advance corporation tax, was discriminatory against other European based companies. Accordingly the law was . .
Appeal from – Loss Relief Group, Test Claimants In v Inland Revenue CA 28-May-2004
The taxpayers sought determination by the court of their various claims for group tax relief. The High Court had declined jurisdiction.
Held: The appeal was allowed. The judge’s attitude was one which would perhaps appeal to most lawyers . .
At first instance – NEC Semi-Conductors Limited and Other Test Claimants v The Commissioners of Inland Revenue ChD 24-Nov-2003
UK companies were subsidiaries of companies resident abroad, and complained that they were unable to make group income elections.
Held: The prohibition infringed non-discrimination provisions of double taxation agreements – non-discrimination . .
At First Instance – Claimants under the Loss Relief Group Litigation Order v Inland Revenue Commissioners ChD 3-Mar-2004
Various claimants sought to have issues of law on group relief and other issues settled under a group litigation order.
Held: The High Court had no jurisdiction to hear such matters until they had first been raised in ordinary tax appeals . .
Cited – In re Vandervell’s Trusts (No 1); Vandervell Trustees Limited v White and Others HL 15-Jul-1970
Practice – Parties – Joinder – Proceedings between subjects raising issues material to income tax – Joinder of Commissioners of Inland Revenue – Income Tax Act 1952 (15 and 16 Geo. 6 and 1 Eliz. 2, c.10), ss. 52 and 64 ; Income Tax Management Act . .
Mentioned – Barraclough v Brown HL 1897
The 1889 Act gave statutory undertakers who had incurred expenditure in removing a sunken vessel a right ‘to recover such expenses from the owner of such vessel in a court of summary jurisdiction.’ the undertakers began their action in the High . .
Approved – Glaxo Group Ltd and Others v Inland Revenue Commissioners ChD 21-Nov-1995
A tax adjustment can be made by the Inland Revenue on an open assessment following transfer pricing enquiry and direction, even after many years. The court considered that the jurisdiction of the special and the general commissioners to determine . .
At Special Comissioners – Marks and Spencer Plc v Halsey (Inspector of Taxes) 2003
Marks and Spencer Plc appealed against the refusal of group relief, on the ground that the statutory limitations on the territorial scope of group relief were incompatible with, and overridden by, Community law. The Special Commissioners dismissed . .
Cited – Regina v Secretary of State for Transport, Ex parte Factortame Ltd HL 18-May-1989
The applicants were companies owned largely by Spanish nationals operating fishing vessels within UK waters. The 1988 Act required them to re-register the vessels as British fishing vessels. The sought suspension of enforcement pending a reference . .
Cited – Amministrazione Delle Finanze Dello Stato v Simmenthal SpA (No 2) ECJ 9-Mar-1978
ECJ The Court of Justice considered a reference for a preliminary ruling, pursuant to article 1977 of the Treaty, as having been validly brought before it so long as the reference has not been withdrawn by the . .
Cited – Imperial Chemical Industries Plc v Colmer (Inspector of Taxes) (No 2) HL 18-Nov-1999
Where a group of companies sought consortium group relief, but the majority of the companies within the group were based outside the European Union, the court need not apply European Union standards to the test, but could instead apply the standards . .
Cited – D v Inspecteur van de Belastingdienst /Particulieren /Ondernemingen buitenland te Heerlen (Free Movement Of Capital) ECJ 5-Jul-2005
ECJ Tax legislation – Wealth tax – Entitlement to an allowance – Separate treatment of residents and non-residents – Double taxation convention. . .
Cited – Dorsch Consult Ingenieursgesellschaft v Bundesbaugesellschaft Berlin mbH ECJ 17-Sep-1997
ECJ Preliminary rulings – Reference to the Court – National court or tribunal within the meaning of Article 177 of the Treaty – Definition – Body competent to hear appeals concerning the award of public . .
Cited – Steenhorst-Neerings v Bestuur van de Bedrijfsvereniging voor Detailhandel, Ambachten en Huisvrouwen ECJ 27-Oct-1993
Europa Community law does not preclude the application of a national rule of law according to which benefits for incapacity for work are payable no more than one year before the date of claim, in the case where . .
Cited – Brasserie du Pecheur v Bundesrepublik Deutschland; Regina v Secretary of State for Transport, ex parte Factortame and others (4) ECJ 5-Mar-1996
Member states may be liable to individuals for their failure to implement EU laws. The right of individuals to rely on directly applicable provisions of the EC Treaty before national courts is not sufficient in itself to ensure full and complete . .
Cited – Elsie Rita Johnson v Chief Adjudication Officer ECJ 6-Dec-1994
Europa Social policy – Equal treatment for men and women in matters of social security – Directive 79/7 – Article 4(1) – Direct effect – National legislation limiting the period prior to the bringing of a claim . .
Cited – Inland Revenue and Another v Deutsche Morgan Grenfell Group Plc CA 4-Feb-2005
The company sought repayment of excess advance corporation tax payments made under a mistake of law. The question was the extent of the effect of the ruling in Klienwort Benson, in particular whether it covered sums paid as taxation, and how the law . .
Cited – Amon v Raphael Tuck and Sons Ltd 1956
The court analysed the circumstances under which additional parties might be joined to an action by a defendant, applying a narrow interpretation. The court considered whether a defendant may be added against the parties’ wishes: ‘There are two . .
Cited – Pickstone v Freemans Plc HL 30-Jun-1988
The claimant sought equal pay with other, male, warehouse operatives who were doing work of equal value but for more money. The Court of Appeal had held that since other men were also employed on the same terms both as to pay and work, her claim . .
Cited – Argosam Finance Co Ltd v Oxby (Inspector of Taxes) CA 1965
A company which dealt in shares issued an originating summons in the Chancery Division requesting a declaration as to the correct method of computing its income for the purposes of loss relief. The revenue challenged the proceedings as an abuse of . .
Cited – In re Vandervell’s Trusts; Vandervell Trustees Limited v White and Others CA 1970
The deceased had sought to create a trust to benefit the Royal College of Surgeons. The parties disputed its tax effect.
Held: Lord Denning MR said: ‘We will in this court give the rule a wide interpretation so as to enable any party to be . .
Cited – Jean Reyners v Belgian State ECJ 21-Jun-1974
Europa The rule on equal treatment with nationals is one of the fundamental legal provisions of the community. As a reference to a set of legislative provisions effectively applied by the country of establishment . .
Cited – Litster and Others v Forth Dry Dock and Engineering Co Ltd HL 16-Mar-1989
The twelve applicants had been unfairly dismissed by the transferor immediately before the transfer, and for a reason connected with the transfer under section 8(1). The question was whether the liability for unfair dismissal compensation . .
Cited – Woolwich Equitable Building Society v Inland Revenue Commissioners (2) HL 20-Jul-1992
The society had set out to assert that regulations were unlawful in creating a double taxation. It paid money on account of the tax demanded. It won and recovered the sums paid, but the revenue refused to pay any interest accrued on the sums paid. . .
Cited – Rewe-Handelsgesellschaft Nord Mbh Et Rewe-Markt Steffen v Hauptzollamt Kiel ECJ 7-Jul-1981
Europa The exemption provided for by regulation no 1544/69, as last amended by regulation no 3061/78, applies only to goods contained in the personal luggage of travellers coming from a non-member country. That . .
Cited – Emmott v Minister for Social Welfare and Attorney General ECJ 25-Jul-1991
Europa So long as a directive has not been properly transposed into national law, individuals are unable to ascertain the full extent of their rights. That state of uncertainty for individuals subsists even after . .
Cited – Kobler v Republik Osterreich ECJ 30-Sep-2003
The claimant’s claim had been presented to the Supreme Administrative Court in Austria, who had referred a question to the ECJ. Following the Schoning decision, the court withdrew the referral, and dismissed the claim. He now claimed damages from . .
Cited – Marshall v Southampton and South West Hampshire Area Health Authority (No 2) ECJ 2-Aug-1993
The UK law limiting awards of damages in sex discrimination cases is unlawful, and fails to implement European directive fully. Financial compensation must be at a level adequate to achieve equality between the workers identified. . .
Cited – Roquette Freres SA v Direction des services fiscaux du Pas-de-Calais ECJ 28-Nov-2000
Europa In the absence of Community rules on reimbursement of national charges levied though not due, it is for the domestic legal system of each Member State to designate the courts and tribunals having . .
Cited – Regina v Commissioners of Inland Revenue ex parte Michael Bishopp (for and on Behalf of Partners In Price Waterhouse (a Firm)) Admn 18-Dec-1997
. .
Cited – Peterbroeck, Van Campenhout and Cie v Belgian State ECJ 14-Dec-1995
It is a basic principle of European Union law that national law should provide effective legal protection, by establishing a system of legal remedies and procedures which ensure respect for the relevant European law right: ‘For the purposes of . .
Cited – Criminal proceedings against Sanz de Lera and others ECJ 14-Dec-1995
Europa Articles 73b(1) and 73d(1)(b) of the Treaty, which prohibit restrictions on movements of capital between Member States and between Member States and non-member countries, on the one hand, and authorizing . .
Cited by:
Cited – Sharp v Caledonia Group Services Ltd EAT 1-Nov-2005
EAT Equal Pay Act – Material factor defence – In an equal pay claim involving a presumption of direct discrimination the genuine material factor defence requires justification by objective criteria.
The . .
Cited – Total Network Sl v Revenue and Customs HL 12-Mar-2008
The House was asked whether an action for unlawful means conspiracy was available against a participant in a missing trader intra-community, or carousel, fraud. The company appealed a finding of liability saying that the VAT Act and Regulations . .
Cited – Blackburn and Another v West Midlands Police CA 6-Nov-2008
The claimants, female police officers, complained that male officers had received priority payments where they had received none. The defendant said that the payments were justified in achieving a proper aim, namely the encouragement of night . .
Cited – The Bodo Community and Others v The Shell Petroleum Development Company of Nigeria Ltd TCC 20-Jun-2014
15,000 or more claimants and claims on behalf of children, sought damages at common law and statutory compensation under the law of Nigeria in relation to oil spills from pipelines said to have been caused by Shell Petroleum Development Company of . .
Cited – Cotter v Revenue and Customs SC 6-Nov-2013
This appeal asked as to the boundary between the jurisdiction of the First-tier Tribunal (Tax Chamber) and that of the county court or the High Court, and the legality of the approach which the Revenue took to entries which Mr Cotter, had made in a . .
Cited – HM Revenue and Customs v Cotter CA 8-Feb-2012
Mr Cotter’s accountants had submitted a second tax return adding claims to loss relief in the following year. The claims were contentious, but he invited a review by the Revenue asserting that the losses wiped out any liability to tax. The Revenue . .
Cited – Revenue and Customs v Cotter ChD 14-Apr-2011
The taxpayer’s accountants had submitted a tax return amending the taxpayer’s own return adding claims for losses. The accountant acknowledged the contentious nature of the claim and invited a review. The Revenue sought now to recover the tax due . .
Lists of cited by and citing cases may be incomplete.
Corporation Tax, Taxes Management
Leading Case
Updated: 02 November 2021; Ref: scu.229067
ECJ Opinion – Interpretation of Articles 43 EC and 48 EC – Freedom of establishment – Tax legislation – Corporation tax – Tax relief – Consortium claim for group relief (consortium relief) – National legislation excluding the transfer of losses within the national territory by one consortium company to another company belonging to a company group to which a ‘link company’ that is also a member of the consortium belongs – Residence requirement imposed on the link company – Discrimination according to the place of the corporate seat – Ultimate parent in third country – Corporate ties passing through third countries
Jaaskinen AG
C-80/12, [2013] EUECJ C-80/12
Bailii
European
Citing:
Reference – The Felixstowe Dock and Railway Company Ltd and Others v Revenue and Customs FTTTx 19-Dec-2011
Corporation tax – joint referral – FA 1998, Sch 18, para 31A – group relief – consortium – surrendering company indirectly partly owned by Luxembourg company – condition that ‘link company’ must be UK resident or carry on a trade in the UK through a . .
Cited by:
Opinion – Felixstowe Dock And Railway Company Ltd v The Commissioners For Her Majesty’s Revenue And Customs ECJ 1-Apr-2014
Judgment – Reference for a preliminary ruling – Freedom of establishment – Corporation tax – Tax relief – Groups of companies and consortia – National legislation permitting losses to be transferred between a company belonging to a consortium and a . .
Lists of cited by and citing cases may be incomplete.
Corporation Tax
Updated: 01 November 2021; Ref: scu.516981
The parties disputed the tax year into which certain profits fell.
Stamp.Orr, Eveleigh LJJ
[1978] EWCA Civ 7, [1978] 1 WLR 832, [1978] 2 All ER 793, (1978) 51 TC 271
Bailii
England and Wales
Corporation Tax
Leading Case
Updated: 01 November 2021; Ref: scu.262692
FTTTx Income Tax – Corporation Tax on capital gains – Whether a claim to add 60,000 pounds as enhancement expenditure to the deductible costs of some let real properties was valid, so occasioning a loss rather than a gain on a part disposal of the properties – Whether there was private use of two company cars available to and utilised by one or both of the directors of the company – whether the capital gains return was fraudulent, and the absence of any disclosures in relation to the asserted car benefits were at the very least negligent – whether penalties were justified and whether they should be adjusted – Appeals substantially disallowed, but allowed in respect of one car
[2014] UKFTT 778 (TC)
Bailii
England and Wales
Income Tax, Corporation Tax
Updated: 31 October 2021; Ref: scu.535984
Corporation tax – joint referral – FA 1998, Sch 18, para 31A – group relief – consortium – surrendering company indirectly partly owned by Luxembourg company – condition that ‘link company’ must be UK resident or carry on a trade in the UK through a permanent establishment – s 402(3), (3A) and (3B) ICTA 1988 – whether requirement an infringement of EU law that can be relied upon by claimant companies – questions referred to CJEU – whether that requirement cannot be applied against claimant companies by virtue of the non-discrimination article of the UK-Luxembourg double tax convention – whether group relief precluded by s 410 ICTA
Roger Berner, Sir Stephen Oliver QC TJJ
[2011] UKFTT 838 (TC), 14 ITL Rep 394, [2012] STI 285, [2012] SFTD 366
Bailii
Finance Act 1998, Income and Corporation Taxes Act 1988 402(3)
England and Wales
Cited by:
Reference – Felixstowe Dock and Railway Company Ltd v The Commissioners For Her Majesty’s Revenue And Customs ECJ 24-Oct-2013
ECJ Opinion – Interpretation of Articles 43 EC and 48 EC – Freedom of establishment – Tax legislation – Corporation tax – Tax relief – Consortium claim for group relief (consortium relief) – National legislation . .
Reference – Felixstowe Dock And Railway Company Ltd v The Commissioners For Her Majesty’s Revenue And Customs ECJ 1-Apr-2014
Judgment – Reference for a preliminary ruling – Freedom of establishment – Corporation tax – Tax relief – Groups of companies and consortia – National legislation permitting losses to be transferred between a company belonging to a consortium and a . .
Lists of cited by and citing cases may be incomplete.
Corporation Tax, European
Updated: 31 October 2021; Ref: scu.450901
Profits Tax – Computation of profits – Dividends received from subsidiary company-Whether profits arising from trade or business carried on by principal company-Whether dividends franked investment income – Finance Act, 1937 (1 Edw. VIII and 1 Geo. VI, c. 54), Section 19 and Fourth Schedule, Paragraph 7.
[1960] UKHL TC – 39 – 410
Bailii
Finance Act, 1937 19
England and Wales
Updated: 20 September 2021; Ref: scu.559970
The taxpayer companies had paid funds into a trust for employees. They sought to set off the payments against their liability to corporation tax. The revenue argued that they were deductible only in the year in which they were paid to the employees.
Held: The taxpayer’s appeal failed: ‘the whole of the funds were potential emoluments. They could be used to pay emoluments.’ The words ‘with a view to their becoming relevant emoluments’ apply both to the purpose for which amounts are held by an intermediary and also to the purpose for which they are ‘reserved in the account of an employer’. The taxpayer argued that relevant emoluments were contractually or constructively payable, whereas a reserve should properly be made for potential emoluments because they are payable only upon the occurrence of a contingency; for example, a bonus payable if a certain profit is achieved. If that was a correct description of potential emoluments for which a reserve has been made, it would be equally true to say that amounts held by an intermediary were for the payment of emoluments upon a contingency, namely the exercise of a discretion by the trustees. In both cases, the sums in question may or may not be used to pay emoluments but there is at least a realistic possibility that they will be. There may be some unfairness in this, but that unfairness had been confirmed by Parliament.
Lord Hoffmann stated that although a definition may give a word a meaning different from its ordinary meaning, the choice of words by Parliament should not be wholly ignored: ‘If the terms of the definition are ambiguous, the choice of the term to be defined may throw some light on what they mean’.
Lord Hoffmann considered the meaning of the defined term ‘potential emoluments’, said: ‘In the ordinary use of language, the whole of the funds were potential emoluments. It is true that, as Charles J pointed out, ‘potential emoluments’ is a defined expression, and a definition may give the words a different meaning from their ordinary meaning. But that does not mean that the choice of words adopted by Parliament must be wholly ignored. If the terms of the definition are ambiguous, the choice of the term to be defined may throw some light on what they mean.’
Lord Nicholls of Birkenhead, Lord Hoffmann, Lord Hope of Craighead, Lord Scott of Foscote, Lord Walker of Gestingthorpe
[2005] UKHL 47, Times 11-Jul-2005, [2005] STC 1111, [2005] BTC 355, (2003) 77 TC 146, 77 TC 146, [2005] 4 All ER 107, [2005] STI 1235, [2005] Pens LR 395
Bailii, House of Lords
Finance Act 1989 37 43, Income and Corporation Taxes Act 1988 202A 202B
England and Wales
Citing:
At First instance – MacDonald (Inspector of Taxes) v Dextra Accessories Ltd and Others ChD 16-Apr-2003
The inspector sought to disallow charging to current tax period payments made by the employer to an employee benefit trust.
Held: The payments were not made and held by the trustees ‘with a view to becoming relevant emoluments’ within the . .
Appeal from – MacDonald (HM Inspector of Taxes) v Dextra Accessories Ltd and others CA 28-Jan-2004
The company had set up a trust for the benefit of its employees. The Inspector sought to tax the payments made into the trust as ’emoluments’
Held: The appeal was allowed. The payments were ‘potential emoluments’ which were held by the . .
Cited – Heasman v Jordan 1954
Emoluments paid under an office or employment are taxed under Schedule E as income of the year of assessment in which they were earned, and it was irrelevant when they were paid. . .
Special Commissioners – Dextra Accessories Ltd and others v Inspector of Taxes SCIT 25-Jul-2002
SXIT EMPLOYEE BENEFIT TRUST – whether deduction of contributions postponed until taxable as emoluments under FA 1989 s.43(11) – no – whether sub-funds in favour of directors who controlled the company taxable as . .
Cited by:
Cited – Barclays Bank Plc and Another v HM Revenue and Customs CA 11-May-2007
Retired bank employees had previously received free tax advice. When the service was withdrawn, the bank made a payment. The Revenue said that this payment was chargeable to income tax.
Held: The bank’s appeal failed. The payment was made ‘in . .
Cited – Routier and Another v Revenue and Customs ChD 18-Sep-2014
Executors appealed against rejection of their claim that a gift in the will qualified for relief against Inheritance Tax as being a charitable gift. The Trusts concerned assets in Jersey.
Held: The appeal failed: ‘The expression ‘held on trust . .
Cited – Routier and Another v Revenue and Customs CA 16-Sep-2016
Executors appealed against a decision that a residual gift in a will was not charitable and that it was therefore subject to Inheritance Tax arguing that the section if construed in this way was an unlawful restriction on the free movement of . .
Cited – RFC 2012 Plc (Formerly The Rangers Football Club Plc) v Advocate General for Scotland SC 5-Jul-2017
The Court was asked whether an employee’s remuneration is taxable as his or her emoluments or earnings when it is paid to a third party in circumstances in which the employee had no prior entitlement to receive it himself or herself.
Held: The . .
Lists of cited by and citing cases may be incomplete.
Updated: 24 August 2021; Ref: scu.228283
ECJ (Opinion of Geelhoed AG) Interpretation of Articles 43 and 56 EC and Articles 4(1) and 6 of Council Directive 90/435/EEC of 23 July 1990 on the common system of taxation applicable in the case of parent companies and subsidiaries of different Member States – Tax exemption granted in a Member State to a company established in its territory which received dividends paid by companies also established in its territory – Exemption not granted for dividends paid to that company by companies established in the territory of another Member State
‘ . . where a member state has a system for preventing or mitigating the imposition of a series of charges to tax or economic double taxation as regards dividends paid to residents by resident companies, it must treat dividends paid to residents by non-resident companies in the same way.
[The Treaty provisions] do not preclude legislation of a member state which exempts from corporation tax dividends which a resident company receives from another resident company, when that state imposes corporation tax on dividends which a resident company receives from a non-resident company in which the resident company holds at least 10% of the voting rights, while at the same time granting a tax credit in the latter case for the tax actually paid by the company making the distribution in the member state in which it is resident, provided that the rate of tax applied to foreign-sourced dividends is no higher than the rate of tax applied to nationally-sourced dividends and that the tax credit is at least equal to the amount paid in the member state of the company making the distribution, up to the limit of the amount of the tax charged in the member state of the company receiving the distribution.
Article [63FEU] precludes legislation of a member state which exempts from corporation tax dividends which a resident company receives from another resident company, where that state levies corporation tax on dividends which a resident company receives from a non-resident company in which it holds less than 10% of the voting rights, without granting the company receiving the dividends a tax credit for the tax actually paid by the company making the distribution in the state in which the latter is resident.
[The Treaty provisions] preclude legislation of a member state which allows a resident company receiving dividends from another resident company to deduct from the amount which the former company is liable to pay by way of advance corporation tax the amount of that tax paid by the latter company, whereas no such deduction is permitted in the case of a resident company receiving dividends from a non-resident company as regards the corresponding tax on distributed profits paid by the latter company in the state in which it is resident.’
C-446/04, [2006] EUECJ C-446/04, [2007] STC 326, [2006] ECR I-11753, [2008] BTC 222, [2006] STI 2750, [2012] 2 AC 436, [2012] 2 WLR 1240, [2006] ECR I-11753, 9 ITL Rep 426, ECLI:EU:C:2006:774, [2007] 1 CMLR 35
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Council Directive 90/435/EEC 6
European
Cited by:
At ECJ – Test Claimants In The Franked Investment Income Group Litigation v Inland Revenue SC 23-May-2012
The European Court had found the UK to have unlawfully treated differently payment of franked dividends between subsidiaries of UK companies according to whether all the UK subsidiaries were themselves UK based, thus prejudicing European . .
At ECJ – Test Claimants In the FII Group Litigation v HM Revenue and Customs ChD 27-Nov-2008
The claimants were companies with parent companies in the UK and other subsidiaries not so resident, both in the EU and outside. They complained of the differences in treatment under corporation tax of the payment of dividends between the . .
See Also – Test Claimants In The FII Group Litigation v The Commissioners For Her Majesty’s Revenue and Customs ECJ 19-Jul-2012
ECJ Articles 49 TFEU and 63 TFEU – Payment of dividends – Corporation tax – Case C-446/04 – Test Claimants in the FII Group Litigation – Interpretation of the judgment – Prevention of economic double taxation – . .
See Also – Test Claimants In The FII Group Litigation v Commissioners of Inland Revenue ECJ 5-Sep-2013
ECJ Opinion – Recovery of national taxes which are contrary to European Union law – Limitation period for instituting proceedings – National legislation curtailing the limitation period with retroactive effect . .
See Also – Test Claimants In The FII Group Litigation v Commissioners of Inland Revenue ECJ 12-Dec-2013
ECJ Judicial protection – Principle of effectiveness – Principles of legal certainty and the protection of legitimate expectations – Restitution of sums paid but not due – Remedies – National legislation – . .
See Also – The Test Claimants In The FII Group Litigation v HM Revenue and Customs ChD 18-Dec-2014
The company claimants had paid large sums in excess tax under a mistake of European law. . .
Cited – Littlewoods Ltd and Others v Commissioners for Her Majesty’s Revenue and Customs SC 1-Nov-2017
The appellants had overpaid under a mistake of law very substantial sums in VAT over several years. The excess had been repaid, but with simple interest and not compound interest, which the now claimed (together with other taxpayers amounting to 17 . .
Cited – Prudential Assurance Company Ltd v Revenue and Customs SC 25-Jul-2018
PAC sought to recover excess advance corporation tax paid under a UK system contrary to EU law. It was now agreed that some was repayable but now the quantum. Five issues separated the parties.
Issue I: does EU law require the tax credit to be . .
Lists of cited by and citing cases may be incomplete.
Updated: 10 August 2021; Ref: scu.374511
References: Ind Summary 05-Apr-1993, Times 23-Feb-1993, Gazette 07-Apr-1993
Ratio: A Charity Tax avoidance plan was lawful. A company made payments to a charity which then employed them as charity trustees. Since the result was clearly to benefit the charity, and its purposes. The obtaining of a relief from tax, and the making use of an exemption are different for this purpose. The claiming of a tax credit is not a claiming of a relief.
Statutes: Income and Corporation Taxes Act 1988 703 709, Income and Corporation Taxes Act 1970 460(3)
Last Update: 06-Sep-16
Ref: 89221
References: [2016] UKUT 320 (TCC)
Links: Bailii
Ratio: UTTC CORPORATION TAX – acquisition of company with accrued losses by company carrying on similar trade – whether acquirer entitled to set losses against income of enlarged group – ICTA ss 337, 343, 393 – losses to be set only against income of predecessor’s trade – appeal allowed
Last Update: 02-Aug-16
Ref: 567366
References: [2015] UKUT 75 (TCC)
Links: Bailii
UTTC Ratio CORPORATION TAX – company lends money to another group company on terms that shares are paid to a different group company – is the value of the shares income of the lender under the loan relationship rules? – no, but only because of the effect of s. 80(5) of the Finance Act 1996 – is the value of the shares income of the share recipient? – yes – appeals dismissed.
Last Update: 20-Apr-16
Ref: 549071
References: [2013] UKUT 124 (TCC)
Links: Bailii
UTTC Corporation tax on capital gains – scheme to generate a capital loss in reliance on the identification rules for matching a disposal of shares with an acquisition under s 106 TCGA 1992 – value shifting rules in s 30 TCGA 1992 – application of s 30(9) notwithstanding that the shares were owned at the time of the disposal, where disposal and acquisition form part of the scheme which engages s 30 – whether, in the alternative, the disposal and acquisition for the purposes of s 30(9) is determined by the computational rules required by s 106 -Davies v Hicks applied – application of s 30(5) to eliminate the capital loss’
References: [2010] UKUT 296 (TCC), [2010] STI 2426, [2010] BTC 1676
Links: Bailii
Consequential decisions and costs. The Tribunal refused to clarify the judgment already given.
References: (1966) 42 TC 675
Coram: Lord Clyde, Lord Guthrie
A co-operative society carried on business as general merchants. Its objects included manufacturing of all kinds. A substantial part of its business was the sale of coal in 1cwt bags and in bulk, distributed by lorry from the society’s coal yard or depot. It also sold coal in 28lb paper bags through its shops as part of its retail business and to other co-operative societies as a wholesaler. It erected a building at its coal depot specifically to house the machinery used to pre-pack the coal in the paper bags. The issue was whether this was an industrial building or structure within the meaning of section 271 of the 1952 Act. The General Commissioners had found that the separation of the coal and the filling of the bags was not a process within the meaning of section 271(1)(c).
Held: The bulk coal delivered to the building was subjected to a process within the meaning of section 271(1)(c) and the building was used for part of the society’s trade so as to come within section 271(2). The pre-packing operation (which was not carried on elsewhere) was held to be a separate part of the society’s trade on the basis that it was a separate commercial activity in its own right.
Lord Clyde: ‘The Crown further argued that in any event the building in question was not in use for a trade or part of a trade which consisted in the subjecting of the goods to a process within the meaning of Section 271(2) of the Act.
It was therefore disqualified from being an industrial building or structure, so the argument runs, within the meaning of the Sub-section. This contention by the Crown is also not specifically dealt with by the Commissioners, if it was presented to them. The argument was that if the Society’s only trade was screening and packing of coal in paper bags then the situation might have been different, but this Society operated a trade of general merchants, and only a small part of their total operations involved paper packaging of screened coal. But the relative proportions of the Society’s various activities appear to me to be quite irrelevant. The building in question houses a definitely identifiable part of their industrial operations and a quite separate activity, and that separate activity alone. This is in my view enough to satisfy the requirements of Sub-section (2).’
Lord Guthrie said: ‘But in my opinion the separation of the dross from the coal is its subjection to a process, the process of selection from the mass of coal of lumps which are suitable for packing in bags. There is no doubt that at the building the Appellants carry on a trade, a business conducted with a view to profit, which consists of the subjection of the coal to this process.’
Statutes: Income Tax Act 1952 271
This case is cited by:
(This list may be incomplete)
Last Update: 27-Feb-16 Ref: 244455
References: [2010] UKUT 213 (TCC), [2010] STC 2470
Links: Bailii
Coram: Warren J P, Sadler J
UTTC EUROPEAN LAW – group relief for losses of non-resident subsidiaries – whether there are no possibilities for those losses to be taken into account at the date of the group relief claim – date of valid claim where series of group relief claims – whether valid group relief claim can be made out of time – application of principle of effectiveness – method of quantifying losses for which group relief claim can be made
This case cites:
This case is cited by:
References: [2012] UKUT 362 (TCC), FTC/72 & 79/2011
Links: Bailii
CORPORATION TAX – scheme to avoid tax on chargeable gains – whether derivative transactions gave rise to chargeable gains and losses – whether loss arising on disposal of shares in group company was an allowable loss – ICTA, s 128, and TCGA, ss 2 and 143 – application of Ramsay principle
References: [2013] UKUT 276 (TCC)
Links: Bailii
Coram: Proudman J
UTTC Corporation Tax- whether the profit on loan notes is subject to the charge to corporation tax under the loan relationship rules. Construction of s. 84(2)(a) of and paragraph 12 of Schedule 9 to the Finance Act 1996. Profits realised on loan notes which the company had agreed to appropriate to share premium account on the issue of shares for the loan notes were not amounts required to be transferred to its share premium account within the meaning of s. 84(2)(a); the profit appropriated to share premium account was not excluded from the scope of s. 84(2)(a) by paragraph 12 of Schedule 9. Appeal and Cross-appeal dismissed.
References: [2012] UKUT 42 (TCC)
Links: Bailii
Coram: ColinBishopp Judge
UTTC Corporation tax – capital allowances – machinery or plant – conversion, fitting out and refurbishment of public houses – whether items of cost qualify for allowances under section 24 CAA 1990 or section 66 CAA 1990 (or both) – consideration of what amounts to alterations to an existing building incidental to the installation of machinery or plant – decision in principle on sample expenditure.
References: [2013] UKUT 189 (TCC)
Links: Bailii
Coram: Asplin J
UTTC Corporation Tax: Effect of receipt by trader or successor to trade of sums in respect of VAT repaid under s80 VATA to representative member of VAT group plus interest paid under s78 VATA. Question of beneficial ownership of sums received and whether ‘arising from the trade’. Application of sections 103 and 106 ICTA 1988. Whether interest payments could be characterised as arising under a ‘loan relationship’ and amounted to a ‘money debt’ for purposes of section 100 FA 1996
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This case is cited by:
References: [2013] UKUT 368 (TCC)
Links: Bailii
UTTC CORPORATION TAX – Claim for capital allowances in respect of ships where the end sub-lease was to a non-UK resident user – Time charter to that end user granted by a UK resident company that claimed that its role (as the disponent owner under the time charter) satisfied the terms of section 123 Capital Allowances Act 2001, and therefore constituted a ‘qualifying user’ so preserving the Respondent finance leasing company’s entitlement to 25% writing-down allowances – Three issues the subject of the appeal by HMRC, and one the subject of a cross-appeal by the Respondent
References: [2014] UKUT 73 (TCC)
Links: Bailii
Coram: Peter Smith J
UTTC Taxation of profits made on sale or transfer of derivatives under Finance Act 2002. Whether transfer disregarded between subsidiaries where one of the companies is not subject to the regime under the 2002 Act. Closure Notice – whether effective when sent by mistake known to the tax payer company.
Held: The transfer was not to be disregarded for the purposes of the 2002 Act but the Closure Notice was effective and prevented HMRC from seeking to claim tax in that tax year arising out of the transfer between the two companies. Appeal allowed.
References: [2014] UKUT 81 (TCC)
Links: Bailii
Coram: Warren P J
UTTC CORPORATION TAX – deemed charge under section 419(1) ICTA 1988 on loans to participators – whether company made loan to employees under employee share scheme – yes – whether company made an advance to employees under scheme – no – whether employees incurred a debt under scheme – yes – whether debt has any value before occurrence of contingent event – yes – appeal dismissed
References: [2013] UKUT 336 (TCC)
Links: Bailii
Coram: Birss J
UTTC Corporation tax – deductibility of expenditure – sponsorship payments intended to improve fortunes of sports club – expectation of trade benefits principally as a result of recognition by others involved with the club of taxpayer’s benefaction – dual purpose of benefiting sports club and taxpayer’s trade – payments not deductible – Income and Corporation Taxes Act 1988, s 74 – appeal dismissed
Statutes: Income and Corporation Taxes Act 1988 74
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