Tag: Income Tax

Andre Agassi v S Robinson (H M Inspector of Taxes) (No 2): CA 2 Dec 2005

The taxpayer had been represented in proceedings throughout by tax law experts, Tenon Media, who were not legally admitted, but had a right to conduct litigation under the 1990 Act. The Inspector objected to paying costs as if the representatives were admitted.
Held: Someone acting through the licensed access schemes was not a litigant in person. However the guidance noted that under the scheme: ‘. . . any litigation will have to be conducted on the basis that the litigant is a litigant in person.’ Though he ws able to recover some disbursements, he was not able to recover the general profit costs of those he had employed.

Judges:

Booke LJ, Dyson LJ, Carnwath LJ

Citations:

[2005] EWCA Civ 1507, Times 22-Dec-2005

Links:

Bailii

Statutes:

Solicitors Act 1974 20, Courts and Legal Services Act 1990 17, Litigants in Person (Costs and Expenses) Act 1975

Jurisdiction:

England and Wales

Citing:

Distinguished – Jonathan Alexander Ltd v Proctor CA 19-Dec-1995
A company represented in proceedings by a director is not a litigant in person, and therefore has no expenses or costs claimable from the other party.
Hirst LJ said: ‘. . the ordinary meaning, as I understand it, of the description ‘litigant . .
See Also – Agassi v Robinson (Inspector of Taxes) CA 19-Nov-2004
. .
Cited – Gregory and Gregory v Turner, Turner; Regina (Morris) v North Somerset Council CA 19-Feb-2003
The parties were involved in a boundary dispute. One granted an enduring power of attorney, and sought to appear as a litigant in person through the power.
Held: The right of a litigant in person to represent himself was a personal right, and . .
Cited – The Law Society of the United Kingdom v Waterlow Brothers and Layton HL 1883
There was a claim that there had been a breach of section 2 of the 1843 Act by law stationers (who had had various dealings with the Probate registry under the supervision of solicitors). The Rules of the Probate Court required applications for . .
Cited – In re Ainsworth, ex parte the Law Society 1905
An unqualified person who gives notice of appearance is thereby acting in contravention of section 2 of the 1843 Act. The relevant rule of court required a notice of appearance to be given either by the defendant himself or his solicitor. . .

Cited by:

Se Also – Agassi v Her Majesty’s Inspector of Taxes HL 17-May-2006
The tax payer played tennis and was paid sums for when he played in England. The sums were paid to his overseas based company.
Held: The revenue’s appeal succeeded. The ‘legislative intendment in relation to sections 555 and 556, and their . .
mentioned – Prudential Plc and Another, Regina (on the Application of) v Special Commissioner of Income Tax and Another Admn 14-Oct-2009
The company had obtained legal advice but had taken it from their accountants. The Revenue sought its disclosure, and the company said that as legal advice it was protected by legal professional privilege.
Held: The material was not protected. . .
Lists of cited by and citing cases may be incomplete.

Income Tax, Costs

Updated: 04 July 2022; Ref: scu.235535

County Pharmacy Ltd v Revenue and Customs: SCIT 3 Aug 2004

SCIT INCOME TAX – Car and Fuel Benefit – is a motorhome a car within the meaning of s168(5)(a) ICTA 1988 – yes – motorhome provided for personal use and by reason of employment – taxpayer liable to pay income tax on car and fuel benefit – Appeal dismissed.
DISCOVERY ASSESSMENT – No tax return produced in evidence – is evidence of the tax return a necessary pre-requisite for making a decision about whether the Revenue has complied with the condition of s29(5) TMA 1970 – yes unless destroyed or lost – the burden of adducing evidence of the return rests on the taxpayer- no evidence adduced – discovery assessment validly made.
NATIONAL INSURANCE CONTRIBUTION – Class 1A NIC – Company liable to pay additional Class 1A on car and fuel benefit – Appeal Dismissed.

Citations:

[2005] UKSPC SPC00495

Links:

Bailii

Jurisdiction:

England and Wales

Income Tax

Updated: 04 July 2022; Ref: scu.230425

A Property Company v HM Inspector of Taxes: SCIT 5 Oct 2004

SCIT SCHEDULE A – income from land – whether agreements for lease gave rise to an immediate right to rent or whether the right was conditional on obtaining the landlord’s consent to subletting – whether the Landlord and Tenant (Covenants) Act 1995 enables retention of a future rent payment on a sale of the reversion – no – whether the definition of the retained rent payment is void for uncertainty – no – whether contractual right to such rent is within Schedule A – no
CASE VI OF SCHEDULE D – profits – as to the rent payable under agreements entered into before the 1995 Act, it is not taxable under Case VI because the only possible head of charge is Schedule A which does not apply because the source has ceased – as to the rent caught by the 1995 Act which passed automatically to the purchaser, the sum equal to the rent purported to be retained on sale that the purchaser was liable to pay to give business effect to the agreement is taxable under Case VI

Citations:

[2004] UK SPC00433

Links:

Bailii

Statutes:

Landlord and Tenant (Covenants) Act 1995

Jurisdiction:

England and Wales

Citing:

Cited – Javad v Aqil CA 15-May-1990
P in possession – tenancy at will Until Completion
A prospective tenant was allowed into possession and then made periodic payments of rent while negotiations proceeded on the terms of a lease to be granted to him. The negotiations broke down.
Held: The tenant’s appeal failed. It was inferred . .

Cited by:

Cited – Wembley National Stadium Ltd v Wembley (London) Ltd and Others ChD 4-Apr-2007
Land at Wembley stadium had been sold to the defendants and leased back. The defendant assigned the freehold within the group, declaring that the lease was held in trust for the original freeholder. The claimant now said that the defendant assignee . .
Lists of cited by and citing cases may be incomplete.

Income Tax, Landlord and Tenant

Updated: 01 July 2022; Ref: scu.228783

Young (H M Inspector of Taxes) v Racecourse Betting Control Board; Racecourse Betting Control Board v Young (H M Inspector of Taxes); Inland Revenue v Racecourse Betting Control Board: HL 29 Jul 1959

HL Income Tax, Schedule D, and Profits Tax-Trade-Expenses-Payments made under scheme for application of moneys in totalisator fund-Runners’ allowance-Whether payments deductible as expenses in computing profits- Racecourse Betting Act, 1928 (18 and 19 Geo. V, c. 41), Section 3 ; Income Tax Act, 1952 (15 and 16 Geo. VI cfe 1 Eliz. II, c. 10), Section 137 (a).

Citations:

[1959] UKHL TC – 38 – 426

Links:

Bailii

Jurisdiction:

England and Wales

Income Tax

Updated: 28 June 2022; Ref: scu.559975

Inland Revenue v Hood Barrs: HL 6 Jul 1961

Income Tax – Procedure – Repayment claim – Loss in trade – Losses certified by General Commissioners without hearing Inspector – Whether appeal in nature of Certiorari lies to Court of Session – Whether certificates valid – Court of Exchequer (Scotland) Act, 1856 (19 and 20 Viet. c. 56), Section 17; Income Tax Act, 1918 (8 and 9 Geo. V, c. 40), Section 34.

Citations:

[1961] UKHL TC – 39 – 683

Links:

Bailii

Statutes:

Income Tax Act 1918, Court of Exchequer (Scotland) Act 1856

Jurisdiction:

England and Wales

Income Tax

Updated: 28 June 2022; Ref: scu.559963

Jackson v Revenue and Customs: FTTTx 5 Jan 2012

FTTTx INCOME TAX – SURCHARGE FOR LATE PAYMENT OF TAX – Did HMRC discharge its burden of proof on whether the tax remained unpaid on the day following the expiry of 28 days from due date – No – should the Appeal be adjourned to clarify the ambiguity – No – Appeal allowed

Citations:

[2012] UKFTT 23 (TC)

Links:

Bailii

Jurisdiction:

England and Wales

Income Tax

Updated: 23 June 2022; Ref: scu.450808

Inland Revenue Commissioners v Europcopy Plc: ChD 12 Feb 1992

A proposed amendment allowing a reduction in length of employees’ share options within a company scheme was disapproved. The nature of such schemes required certainty as to the rights and reliefs granted, and this was in effect a rescission of the original scheme and replacement by a new one.

Citations:

Gazette 12-Feb-1992

Statutes:

Finance Act 1984 38

Jurisdiction:

England and Wales

Income Tax

Updated: 17 June 2022; Ref: scu.82342

Inland Revenue Commissioners v Reed International Plc: ChD 10 Mar 1994

Change in the employees’ share option scheme allowed the Inland Revenue to withdraw approval.
Inland Revenue may refuse approval to amendment of share option schemes.

Citations:

Ind Summary 21-Mar-1994, Times 10-Mar-1994

Statutes:

Income and Corporation Taxes Act 1988

Jurisdiction:

England and Wales

Income Tax

Updated: 17 June 2022; Ref: scu.82359

Inland Revenue Commissioners v Coathew Investments Ltd: HL 31 Mar 1966

Surtax – Investment company – Computation of actual income – Deduction – Annual payment under voluntary covenant – Beneficiary not an individual – Income Tax Act 1952 (15 and 6 Geo. 6 c 1 Eliz. 2, c. 10), ss. 245, 248, 255(3), 262 and 45 .

Citations:

[1966] UKHL TC – 43 – 301, [1966] 1 WLR 716, [1966] 1 All ER 1032, [1966] TR 81, (1966) 43 TC 301

Links:

Bailii

Jurisdiction:

England and Wales

Income Tax

Updated: 14 June 2022; Ref: scu.559800

Wilson (HM Inspector of Taxes) v Clayton: ChD 29 Apr 2004

Taxability of compensation paid on compromise of claims after dismissal. The employer introduced new terms, withdrawing car benefits. Having refused the new terms the taxpayer was dismissed. A tribunal held him unfairly dismissed. The council re-instated him and others and made a compensatory payment. The Revenue contended that the re-instatement made the payment taxable.
Held: The cases of Hochstrasser and Wilmshurst set the test for what wa staxable pay. This payment resulted from a negotiated settlement, and was directly consequential of the dismissal and finding of unfair dismissal. The payment was not taxable because it was under andpound;30,000.

Judges:

The Honourable Mr Justice Patten

Citations:

[2004] EWHC 898 (Ch), Times 07-Jun-2004, Gazette 13-May-2004, [2004] STC 1022

Links:

Bailii

Statutes:

Income and Corporation Taxes Act 1988 148

Jurisdiction:

England and Wales

Citing:

Applied – Shilton v Wilmshurst HL 7-Feb-1991
The taxpayer was transferred from one football club to another. He was paid andpound;75,000 to persuade him to move. The revenue appealed a decision that this was not a sum taxable as an emolument under Schedule E by the new employer.
Held: . .

Cited by:

Appeal from – Wilson (HM Inspector of Taxes) v Clayton CA 7-Dec-2004
The claim against the defendant at the tribunal had been settled by a compromise which had then been the subject of an order by the tribunal. The Revenue sought to charge the payment to income tax.
Held: It had been paid ‘in connection with’ . .
Lists of cited by and citing cases may be incomplete.

Income Tax, Employment

Updated: 10 June 2022; Ref: scu.196104

Parmar (T/A Ace Knitwear) v Inspector of Taxes: SCIT 14 Aug 2001

INCOME TAX – partnership – whether a loss was incurred in the year ending on 31 December 1991 – no – whether the disposal value of machinery and plant destroyed by fire in 1991 exceeded the capital expenditure incurred in the provision of that machinery and plant – no – whether there was a disposal value of machinery and plant transferred on the discontinuance of the trade in 1994 where no payment was received – yes – whether the capital allowances basis periods applied on the discontinuance of the trade in 1994 – yes – appeal dismissed – ICTA 1988 s385; CAA 1990 s26 and 160(3)(b)Catchwords: use right arrow to move to starting point after this box

Citations:

[2001] UKSC SPC00291

Links:

Bailii

Cited by:

Appeal from – Parmar and others (trading as Ace Knitwear) v Woods (Inspector of Taxes) ChD 30-May-2002
The taxpayers had been represented by a professional accountant, but incompetently. They sought leave to renew the appeal on the basis that the representation had been poor.
Held: The chartered accountant had a statutory right of audience. His . .
Lists of cited by and citing cases may be incomplete.

Income Tax

Updated: 10 June 2022; Ref: scu.195381

Knitware v HM Inspector of Taxes: SCIT 9 Jun 2003

INCOME TAX – transfer of business assets from partnership to limited company – stock, plant and machinery transferred at agreed values – whether balancing adjustment should be made in partnership accounts in respect of plant and machinery – whether partnership entitled to deduction for bad debts in respect of value of stock – whether partnership was paid by the company for the assets – yes – appeal dismissed – ICTA 1988 S 74(1)(j); CAA 1990 S 26(1)(a)

Citations:

[2003] UKSC SPC00367

Links:

Bailii

Jurisdiction:

England and Wales

Income Tax

Updated: 10 June 2022; Ref: scu.195426

Sir Graham Stanley Latimer and others – Trustees for the Crown Forestry Rental Trust v The Commissioner of Inland Revenue: PC 25 Feb 2004

PC (New Zealand) The Crown created a charitable trust for certain Maori people. Upon exhaustion of the purpose, the fund was to revert to the Crown. The trustees appealed a finding of liability to income tax.
Held: A charitable trust could co-exist with a non-charitable trust. ‘The distinction is between ends, means and consequences. The ends must be exclusively charitable. But if the non-charitable benefits are merely the means or the incidental consequences of carrying out the charitable purposes and are not ends in themselves, charitable status is not lost.’ The fact that some residue might revert to a non-charitable purpose on the trust coming to an end need not defeat the charitable nature of the trust. The trust was exempt.

Judges:

Lord Nicholls of Birkenhead, Lord Millett, Lord Walker of Gestingthorpe, Sir Martin Nourse, Sir Kenneth Keith

Citations:

[2004] UKPC 13, Times 19-Mar-2004

Links:

PC, Bailii, PC

Jurisdiction:

England and Wales

Citing:

Cited – Royal College of Surgeons of England v National Provincial Bank Ltd HL 1952
The College was established to promote and encourage the study and practice of the art and science of surgery. The professional protection of members of the College (not a charitable purpose) was held to be ‘an incidental though an important and . .
Cited – In re Sir Robert Peel’s School at Tamworth CA 1868
Income under a trust was, until exercise of a power of revocation, if valid, subject to a mandatory trust for expenditure on the maintenance of a school.
Held: Unless and until the power of revocation was exercised, the trust was a valid . .
Cited – Chichester Diocesan Board of Finance v Simpson HL 21-Jun-1944
The court was asked whether a gift in a will to the trustees ‘for such charitable institution or institutions or other charitable or benevolent object or objects in England’ as they should select, was valid.
Held: ‘The fundamental principle is . .
Cited – Thellusson v Woodford 1799
A gift over to the Crown was held to be impressed with a charitable trust for the relief of the national debt and so charitable. . .
Cited – Newland v Attorney-General 1809
Charitable purpose implied . .
Cited – Twinsectra Ltd v Yardley and Others HL 21-Mar-2002
Solicitors acted in a loan, giving an undertaking as to its application. In breach of that undertaking they released it to the borrower. The appellants appealed a finding of liability as contributors to the breach.
Held: ‘Money in a . .
Cited – Nightingale v Goulbourn 1847
A testamentary gift to the Chancellor of the Exchequer was expressly impressed with a trust for Great Britain. . .
Cited – Barclays Bank Ltd v Quistclose Investments Ltd; etc HL 31-Oct-1968
R Ltd were in serious financial difficulties. The company’s overdraft with the appellant bank was almost twice its permitted limit. The company sought a loan of 1 million pounds from a financier, who was willing to lend the company that sum provided . .
Cited – Ashton v Langdale 1851
Inference of charitable purposes. . .
Cited – In re Smith 1932
A gift ‘unto my country England’ was construed as a charitable gift for the benefit of the inhabitants of England and, by analogy with the cases on gifts to a parish, town or city, as impressed with a trust that it be applied for charitable purposes . .
Lists of cited by and citing cases may be incomplete.

Income Tax, Charity

Updated: 10 June 2022; Ref: scu.193880

Norris (Inspector of Taxes) v Edgson: ChD 30 May 2000

Where a father paid child support to the mother through the Child Support Agency, and where the mother had re-married and that subsequent marriage had also ended in divorce, the maintenance paid did not attract income tax relief under the section. The payment remained a ‘qualifying payment’ for claiming the tax relief only until the other party had re-married. A subsequent divorce did not defeat fulfilment of that condition.

Citations:

Gazette 31-May-2000, Times 30-May-2000

Statutes:

Income and Corporation Taxes Act 1988 347B

Jurisdiction:

England and Wales

Child Support, Income Tax

Updated: 05 June 2022; Ref: scu.84340

Nichols v Gibson (Inspector of Taxes): ChD 25 Jan 1995

Income in the form of a termination payment, was taxable in the UK despite the fact that no duties had been performed in that tax year in the UK, and the payee had become a foreign resident.

Citations:

Gazette 25-Jan-1995, Ind Summary 06-Feb-1995, Times 12-Dec-1994

Jurisdiction:

England and Wales

Cited by:

Appeal from – Nichols v Gibson (Inspector of Taxes) CA 9-Jul-1996
A severance payment made after an employee had ceased to reside in the UK remained liable to tax under Schedule E. . .
Lists of cited by and citing cases may be incomplete.

Income Tax

Updated: 05 June 2022; Ref: scu.84296

Nuclear Electric Plc v Bradley (Inspector of Taxes): ChD 10 Apr 1995

Interest on funds set aside for future costs was trading income-liabilities current.

Citations:

Ind Summary 10-Apr-1995

Jurisdiction:

England and Wales

Cited by:

Appeal from – Nuclear Electric Plc v Bradley (Inspector of Taxes) CA 13-Nov-1995
Income on funds set aside but not allocated for expenditure not trading income . .
Lists of cited by and citing cases may be incomplete.

Income Tax

Updated: 04 June 2022; Ref: scu.84386

Koenigsberger v Mellor (Inspector of Taxes): ChD 25 May 1993

Premiums which had been paid were not relevant earnings for annuity relief purposes. It was not income derived from the any trade or profession.

Citations:

Ind Summary 31-May-1993, Times 25-May-1993

Statutes:

Income and Corporation Taxes Act 1988 619

Jurisdiction:

England and Wales

Citing:

Appealed to – Koenigsberger v Mellor (Inspector of Taxes) CA 15-May-1995
External Lloyds name does not get retirement annuity relief on underwriting profit. . .

Cited by:

Appeal from – Koenigsberger v Mellor (Inspector of Taxes) CA 15-May-1995
External Lloyds name does not get retirement annuity relief on underwriting profit. . .
Lists of cited by and citing cases may be incomplete.

Income Tax

Updated: 04 June 2022; Ref: scu.82828

Melluish (Inspector of Taxes) v BMI (No3) Ltd and Related Appeals: ChD 15 Feb 1994

No capital allowances were available for a lease of heating equipment in a tenanted property. Allowances might be available if the property were not tenanted.

Citations:

Gazette 02-Mar-1994, Ind Summary 28-Mar-1994, Times 15-Feb-1994

Statutes:

Finance Act 1971 44(1)

Jurisdiction:

England and Wales

Cited by:

Appeal from – Melluish (Inspector of Taxes) v BMI (No 3) Ltd and Related Appeals CA 17-Aug-1994
Capital allowances were not available on plant which had been leased to the Local Authority and which had since had become part of land occupied by them. The plant was no longer owned by the tax payers. Leased fixtures given capital allowances by . .
Lists of cited by and citing cases may be incomplete.

Income Tax

Updated: 04 June 2022; Ref: scu.83614

McKnight (Inspector of Taxes) v Sheppard; Sheppard v McKnight: ChD 21 May 1996

Legal costs and fines not deductible – insufficiently connected with trade.

Citations:

Times 21-May-1996

Statutes:

Income and Corporation Taxes Act 1988 74(1)

Jurisdiction:

England and Wales

Citing:

Cited – Mallalieu v Drummond HL 27-Jul-1983
The taxpayer was a barrister. To comply with Bar guidance on court dress, she wore, in court and in and to and from chambers black dresses, suits and shoes and white blouses. The clothing were perfectly ordinary articles suitable for everyday wear. . .

Cited by:

Appeal From – David McKnight (Inspector of Taxes) v Sheppard CA 7-May-1997
Legal expenses incurred by a professional in defending disciplinary proceedings are deductible from taxable profits. . .
At first instance – McKnight (Inspector of Taxes) v Sheppard HL 18-Jun-1999
The taxpayer sought to set off against tax some pounds 200,000 spent defending professional disciplinary proceedings. The House was asked whether this was ‘money wholly and exclusively laid out or expended for the purposes of the trade.’
Held: . .
Lists of cited by and citing cases may be incomplete.

Income Tax

Updated: 04 June 2022; Ref: scu.83557

Mclaren v Mumford (Inspector of Taxes): ChD 2 Aug 1996

A publican’s payment for the domestic rental of a flat above the public house was not deductible for income tax purposes, since it was not incurred entirely and exclusively for business purposes.

Citations:

Times 02-Aug-1996, Gazette 16-Oct-1996

Statutes:

Income and Corporation Taxes Act 1988 74

Jurisdiction:

England and Wales

Income Tax

Updated: 04 June 2022; Ref: scu.83559

Maidment (Inspector of Taxes) v Kibby: ChD 12 Jul 1993

Profits were taxable as a whole for a new business purchased and existing business. Business bought to incorporate in existing taxed on preceding year basis.

Citations:

Ind Summary 12-Jul-1993, Times 12-Jul-1993

Statutes:

Income and Corporation Taxes Act 1970 154, Income and Corporation Taxes Act 1988 113

Jurisdiction:

England and Wales

Income Tax

Updated: 04 June 2022; Ref: scu.83323

British Commonwealth International Newsfilm Agency Ltd v Mahany (HM Inspector of Taxes): HL 20 Dec 1962

HL Income Tax, Schedule D – Annual payment made to a trading company- Whether trading receipt – Whether recipient entitled to repayment of tax – Income Tax Act, 1952 (15 and 16 Geo. VI and 1 Eliz. II, c. 10), Section 123, Schedule D, Case III.

Citations:

[1962] UKHL TC – 40 – 550

Links:

Bailii

Statutes:

Income Tax Act 1952 123

Jurisdiction:

England and Wales

Income Tax

Updated: 29 May 2022; Ref: scu.559959

EMI Group Electronics Ltd v Coldicutt (Inspector of Taxes): ChD 12 Nov 1997

Payments which were made in lieu of a termination notice were taxable, because the right to make such payments had been explicitly reserved in the contract of employment, and the payment was therefore under that contract.

Citations:

Times 14-Nov-1997, Gazette 12-Nov-1997

Statutes:

Income and Corporation Taxes Act 1988 19(1)

Jurisdiction:

England and Wales

Income Tax, Employment

Updated: 25 May 2022; Ref: scu.80313

Olofsson v Revenue and Customs: FTTTx 3 Aug 2012

NATIONAL INSURANCE CONTRIBUTIONS -whether contributions paid in period preceding record of appellant entering national insurance – whether additional contributions paid afterwards which were not reflected on appellant’s national insurance record -no -whether there was a duplicate contribution record – balancing weight of oral and other evidence of appellant against record and evidence on procedures for creation, maintenance and retrieval of national insurance contribution records- contributions record correct – appeal dismissed

Citations:

[2012] UKFTT 490 (TC)

Links:

Bailii

Jurisdiction:

England and Wales

Income Tax

Updated: 23 May 2022; Ref: scu.466118

Mitchell (Surveyor of Taxes) v Egyptian Hotels Ltd: HL 9 Jul 1915

A company incorporated in England carried on from there an hotel business in Egypt until 1906. In that year they altered their Articles of Association by resolutions which provided that the Egyptian business of the company should be carried on and managed by a local board in Egypt to the exclusion of any board of directors other than the local board. The Commissioners had found that the head and seat and controlling power of the company remained in England with the board of directors of the company.
Held: Lord Parker and Lord Sumner found that the trade or business of the company was carried on wholly outside the United Kingdom while Lord Parmoor, whose view was shared by Earl Loreburn, was that the Commissioners of Inland Revenue were entitled to find that the business was not exclusively carried on outside the United Kingdom when all the general financial arrangements were dealt with and controlled at meeting held from time to time at the offices of the company in England. Lord Parker said that ‘a trade or business cannot be said to be wholly carried on abroad if it be under the control and management of persons resident in the United Kingdom, although such persons act wholly through agents and messengers resident abroad. Where the brain which controls the operations from which the profits and gains arise is in this country, the trade or busines is, at any rate partly, carried on in this country.’

Judges:

Earl Loreburn, Lord Parker, Lord Sumner

Citations:

[1915] UKHL 2, [1915] AC 1022

Links:

Bailii

Jurisdiction:

England and Wales

Income Tax

Updated: 22 May 2022; Ref: scu.265980

McKnight (Inspector of Taxes) v Sheppard: HL 18 Jun 1999

The taxpayer sought to set off against tax some pounds 200,000 spent defending professional disciplinary proceedings. The House was asked whether this was ‘money wholly and exclusively laid out or expended for the purposes of the trade.’
Held: Where legal costs had been incurred in the defence of professional misconduct proceedings in order to protect the partnership’s ability to continue in practice, such costs were deductible against tax having been incurred wholly and exclusively for the purpose of the trade.

Judges:

Lord Hoffmann, Lord Mackay of Clashfern, Lord Clyde, Lord Hutton Lord Hobhouse of Wood-borough

Citations:

Times 18-Jun-1999, Gazette 07-Jul-1999, [1999] UKHL 6, [1999] 1 WLR 1333, [1999] 3 All ER 491

Links:

House of Lords, Bailii

Statutes:

Income and Corporation Taxes Act 1988 130(a)

Jurisdiction:

England and Wales

Citing:

Appeal From – David McKnight (Inspector of Taxes) v Sheppard CA 7-May-1997
Legal expenses incurred by a professional in defending disciplinary proceedings are deductible from taxable profits. . .
Cited – Mallalieu v Drummond HL 27-Jul-1983
The taxpayer was a barrister. To comply with Bar guidance on court dress, she wore, in court and in and to and from chambers black dresses, suits and shoes and white blouses. The clothing were perfectly ordinary articles suitable for everyday wear. . .
At first instance – McKnight (Inspector of Taxes) v Sheppard; Sheppard v McKnight ChD 21-May-1996
Legal costs and fines not deductible – insufficiently connected with trade. . .
Cited – Morgan v Tate and Lyle Ltd HL 1955
The words ‘for the purposes of the trade’ in the statute mean ‘for the purposes of enabling a person to carry on and earn profits in the trade’. Money spent for the purpose of preserving the trade from destruction can properly be treated as wholly . .
Cited – Inland Revenue Commissioners v Von Glehn CA 1920
The company had paid a penalty during the First World War under the Customs (War Powers) Act 1915 for exporting goods without taking all reasonable care to secure that the ultimate destination should not be enemy territory. They sought to set off . .
Cited – The Herald and Weekly Times Ltd v Federal Commissioner of Taxation 21-Nov-1932
(High Court of Australia) The taxpayer newspaper sought to set off against its liability to income tax, sums which it had paid out in damages for defamation.
Held: They were deductible. Such claims against a newspaper are a ‘regular and almost . .
Cited – Edwards (Inspector of Taxes) v Bairstow HL 25-Jul-1955
The House was asked whether a particular transaction was ‘an adventure in the nature of trade’.
Held: Although the House accepted that this was ‘an inference of fact’, on the primary facts as found by the Commissioners ‘the true and only . .
Cited – Smith’s Potato Estates Ltd v Bolland (Inspector of Taxes) HL 1948
The taxpayer claimed to deduct the legal costs of contesting an assessment to tax. The dispute was about the computation of the taxpayer’s profits. It assumed that those profits were ascertainable, one way or another, at the time when the dispute . .
Lists of cited by and citing cases may be incomplete.

Income Tax

Updated: 19 May 2022; Ref: scu.83555

Jarmin (Inspector of Taxes) v Rawlings: ChD 13 Dec 1994

Retirement relief was to be given on the sale of a milking parlour and yard when accompanied by a cessation of the trade involving those assets.

Citations:

Ind Summary 23-Jan-1995, Gazette 11-Jan-1995, Times 13-Dec-1994

Jurisdiction:

England and Wales

Income Tax, Income Tax, Capital Gains Tax

Updated: 19 May 2022; Ref: scu.82496

Inland Revenue Commissioners v Willoughby: HL 16 Jul 1997

Rules which disallowed exemption from tax for the transfer of assets abroad in order to avoid income tax do not apply where the taxpayer is not ordinarily resident here.

Citations:

Times 16-Jul-1997, Gazette 23-Jul-1997, [1997] STC 995, [1997] UKHL TC – 70 – 57, [1997] UKHL 29, [1997] 1 WLR 1071

Links:

House of Lords, Bailii, Bailii

Statutes:

Income and Corporation Taxes Act 1988 739

Citing:

Appeal from – Inland Revenue Commissioners v Willoughby and Another CA 6-Jan-1995
Anti-avoidance provisions do not catch a transfer of assets which were located abroad and which made at a time when the taxpayer was a non UK resident. . .

Cited by:

Appealed to – Inland Revenue Commissioners v Willoughby and Another CA 6-Jan-1995
Anti-avoidance provisions do not catch a transfer of assets which were located abroad and which made at a time when the taxpayer was a non UK resident. . .
Lists of cited by and citing cases may be incomplete.

Income Tax

Updated: 19 May 2022; Ref: scu.82361

Clarke (Inspector of Taxes) v Perks; MacLeod (Inspector of Taxes) v Same; Guild (Inspector of Taxes) v Newrick and Another: ChD 3 May 2000

The relief of foreign earnings given to those working as seafarers, did not apply to those working on a jack-up drilling rig with floating hull, and retractable legs., since this was not a ship. Being a seafarer involved the performance of duties on a ship. Definition in other acts suggested a vessel used in navigation. These rigs were without propulsion. Other decisions indicated the need for it to be used for navigation.

Citations:

Times 03-May-2000, Gazette 11-May-2000

Statutes:

Income and Corporation Taxes Act 1988 193 Sch 12

Cited by:

Appeal from – Perks and Others v Clark and Others CA 27-Jul-2001
Workers on North Sea drilling rigs which were capable of being moved, claimed relief as seafarers, since they were employed on a ship. The first instance court said the rigs were not ships. They appealed.
Held: The word ‘ship’ is an ordinary . .
Lists of cited by and citing cases may be incomplete.

Transport, Income Tax

Updated: 19 May 2022; Ref: scu.79200

Carstairs (Inspector of Taxes) v Sykes: ChD 20 Dec 2000

The taxpayer had claimed tax relief for certain periods (approximately six years) when he was living abroad. The Crown appealed a decision of the commissioners discharging their assessment to tax.
Held: There is a distinction in law between the residence abroad and absence for the purposes of tax relief. The taxpayer can be resident, but absent abroad. For the purposes of the provisions of schedule E tax deductions on foreign earnings, the taxpayer should not be free to include periods when he was neither resident, nor ordinarily resident, when aggregating the qualifying period of absence. Whether someone was at any particular moment absent from the UK could only be answered in the context of the question. In this context that, must require the court to give to meaning of a qualifying period absence in the sense of not being physically present in the place of residence.

Judges:

Hart J

Citations:

Times 20-Dec-2000

Statutes:

Income and Corporation Taxes Act 1988 193(1) Sch E

Income Tax, Taxes Management

Updated: 19 May 2022; Ref: scu.78919

Baird v Williams (Inspector of Taxes): ChD 25 May 1999

A clerk to the commissioners, though required to maintain an office for his post, could not set off the costs against tax, where the cost of interest payments on a mortgage to purchase the office were not wholly and exclusively incurred for that purpose.

Citations:

Times 25-May-1999, Gazette 03-Jun-1999

Statutes:

Income and Corporation Taxes Act 1988 198(1)

Income Tax

Updated: 18 May 2022; Ref: scu.78087

Ansell (Inspector of Taxes) v Brown: ChD 23 May 2001

A professional rugby player bought and consumed dietary supplements to make it easier to maintain the physical standards required by his employers. He claimed the cost of the supplements against his income tax. The commissioners allowed his claim, and the revenue appealed.
Held: The commissioners had erred. The requirements for the deduction were stringent, exacting and rigid. The expense had not been incurred in the performance of the duties. His duties had not obliged him to incur the expense. The supplements had been incurred in order to put him into a position where he could perform his duties. That was not enough.

Judges:

Lightman J

Citations:

Times 20-Jun-2001, Gazette 09-Aug-2001

Statutes:

Income and Corporation Taxes Act 1988 Sch E

Income Tax

Updated: 17 May 2022; Ref: scu.77805

Shilton v Wilmshurst (Inspector of Taxes): CA 1990

The taxpayer was a goalkeeper employed by Nottingham Forest Football Club. On his transfer to Southampton, he was paid pounds 75,000. The revenue appealed a finding that this was not taxable under Schedule E.
Held: To be taxcable it had to be referrable to the services provided by him under the contract of employment. This payment was made purely to persuade him to move employments, and was not therefore part of his emoluments at the new club. The payment was made in respect of his services at Nottingham, but was made by a third party.

Citations:

[1990] 1 WLR 373, [1990] STC 55

Statutes:

Income and Corporation Taxes Act 1988 181

Jurisdiction:

England and Wales

Citing:

Distinguished – Hamblett v Godfrey (Inspector of Taxes) CA 2-Jan-1986
Affirmed. A single one off lump sum payment was found to be an emolument without consideration as to whether or not it was a capital payment. Miss Hamblett ‘received her payment as a recognition of the fact that she had lost certain rights as an . .
Considered – Pritchard (Inspector of Taxes) v Arundale ChD 1971
Megarry J discussed whether tips receieved were part taxable as an emolument: ‘I think the question to be tested in this way is only one question. Either the emoluments are within the statutory word ‘therefrom’, as explained by the cases, or they . .

Cited by:

Appeal from – Shilton v Wilmshurst HL 7-Feb-1991
The taxpayer was transferred from one football club to another. He was paid andpound;75,000 to persuade him to move. The revenue appealed a decision that this was not a sum taxable as an emolument under Schedule E by the new employer.
Held: . .
Lists of cited by and citing cases may be incomplete.

Income Tax

Updated: 16 May 2022; Ref: scu.199541

The National Provident Institution v Brown (Surveyor of Taxes): CA 10 May 1920

Lord Sterndale MR said: ‘It seems to me to be a general principle of Income Tax Law that a person in order to be taxable in a particular year must have an income arising from a source existing in that year and in order to justify this assessment the Crown must show some reason for departing from that general principle. It is admitted that if the taxation be in respect of a trade, or business, or an office, or of property the taxpayer must continue in the year of charge to carry on the trade or business or hold the office or the property. It was, however, contended for the Crown that the principle did not apply in this case because by the first rule of the Third Case the duty to be charged was computed according to the profits of the preceding year, and, therefore, if the last year was not taxed because there was no source, one year escaped taxation altogether. I do not think the first rule has this effect. The provision as to computation of profits is the same as that in respect of trades, etc., in the first rule of the First Case, and it is admitted that in that instance the trade must exist in the taxable year in order to make the taxpayer liable. I see no reason for construing the same provision in a different way in the two rules; both refer to methods of computation only, and are not directed to whether there is a taxable income or not. Besides, as pointed out in Dowell’s Income Tax Laws, 7th Edition, page 300, the Third Case originally dealt with property which must have existed in the hands of the taxpayer in the taxable year in order to make him liable, and it can hardly have been intended by the insertion of the second rule to alter the effect of the first. if the first year does escape taxation, it is because the Legislature has not inserted in the second rule of the Third Case such a provision as is found in the first rule of the First Case. It is suggested by the Commissioners that the profits of the first year might be taxed under the Sixth Case. I do not think it necessary to decide that point, for even if they be not taxable it does not in my opinion show that the taxpayer can be taxed in respect of a source of income which does not exist.’

Judges:

Lord Sterndale MR

Citations:

[1920] 3 KB 35

Statutes:

Income Tax 1842

Jurisdiction:

England and Wales

Cited by:

Appeal from – The National Provident Institution v Brown (Surveyor of Taxes) HL 3-Jun-1921
The House was asked (inter alia) whether discounts on certain Treasury Bills could be subject to taxation, on a preceding year basis, for a year in which the taxpayer did not hold or have any transactions in the relevant securities.
Held: The . .
Lists of cited by and citing cases may be incomplete.

Income Tax

Updated: 16 May 2022; Ref: scu.606460

RJ Herbert Engineering Ltd v Revenue and Customs: FTTTx 11 Dec 2013

FTTTX INCOME TAX – PAYE – penalties under Schedule 56, Finance Act 2009 – whether no liability for such penalties because – (1) the relevant late payments of PAYE were made during the currency of an agreement for deferred payment (para. 10, Sch 56, FA 2009) – found on the facts that 4 out of 6 of them were – or (2) because there should be a reduction to take account of special circumstances (para. 9 Sch 56 FA 2009) – held that the Tribunal would make no such reduction in relation to the remaining 2 penalties – or (3) because there was a reasonable excuse for the failure to make the relevant payments of PAYE on time (para 16 Sch 56 FA 2009) – found on the facts in relation to the remaining 2 penalties that no such reasonable excuse had been established – appeal allowed in part

Citations:

[2013] UKFTT 753 (TC)

Links:

Bailii

Statutes:

Finance Act 2009

Jurisdiction:

England and Wales

Income Tax

Updated: 16 May 2022; Ref: scu.519643

Smith (Inspector of Taxes) v Abbott; Same v Holt; Same v Scovell Etc: ChD 22 Jan 1992

Expenditure incurred by an employee directly mainly to keep himself qualified to do his work. Reading of newspapers is an necessary part of a journalist’s occupation and the cost of buying them is a deductible expense.

Citations:

Gazette 22-Jan-1992

Statutes:

Income and Corporation Taxes Act 1988 s198 (1)

Jurisdiction:

England and Wales

Income Tax

Updated: 15 May 2022; Ref: scu.89312

Smith (Inspector of Taxes) v Woodhouse and Others; Fitzpatrick and Others v Commissioners of Inland Revenue: HL 18 Feb 1994

An allowance paid to a journalist by his employer to pay for newspapers he was to buy and read as part of his work was taxable under Sch E. It was not actually part of his job to read them.

Citations:

Times 18-Feb-1994, Independent 18-Feb-1994

Statutes:

Income and Corporation Taxes Act 1970 189(1)

Jurisdiction:

Scotland

Income Tax

Updated: 15 May 2022; Ref: scu.89315

Vaughan-Neil v Inland Revenue Commissioners: ChD 1979

All that is required for a severance payment to be taxable is that there is a ‘connection’ between the actual, prospective or past holding of the employment and the giving of the undertaking.

Judges:

Oliver J

Citations:

[1979] STC 644

Jurisdiction:

England and Wales

Citing:

Cited – Beak v Robson HL 1942
The issue was whether a payment to an employee in return for a restrictive covenant escaped tax. The obligations flowing from the contract of service and the remuneration to be received by the Respondent in respect of that service were entirely . .

Cited by:

Cited – RCI Europe Ltd v Kate Woods (HM Inspector of Taxes) ChD 16-Dec-2003
The company made payments to a former director in return for a severance agreement which restricted his future business activities.
Held: Despite the fact that all payments were made only after his employment had been terminated, they remained . .
Lists of cited by and citing cases may be incomplete.

Income Tax

Updated: 13 May 2022; Ref: scu.190494

Commissioner for Inland Revenue v Mitsubishi Motors New Zealand Ltd: PC 1 Nov 1995

(New Zealand) The taxpayer company sold cars to its dealers who resold them with warranties, for which it gave the dealers indemnities calculated on statistical average. The company sought to set off the reserve it created to make payments under the indemnities against the revenue of the year in which the cars were sold. The commissioner appealed its case to the Board.
Held: The reserve was claimable in the year of the car sale, even though the losses remained contingent. On the year of the sale the company acquired an accrued legal obligation, and had properly deducted the liabilities incurred against its profits.

Judges:

Lord Hoffmann

Citations:

Gazette 01-Nov-1995, [1996] AC 315

Statutes:

Inland revenue Act 1976 (New Zealand) 104

Income Tax, Commonwealth

Updated: 10 May 2022; Ref: scu.79312

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 shares be retransferred to him and a sum paid to him representing the dividends which the purchaser had received while he was registered as the shareholder. After the judgment, the Revenue repaid the surtax assessed on the dividends in the hands of the fraudulent purchaser and assessed the taxpayer instead. The years of assessment were those in which the dividends had been paid by the company.
Held: The assessment was valid.in the Inner House of the Court of Session.
Lord President Normand said: ‘In this case the contract was not void; it was merely voidable on the ground that it had been induced by fraudulent misrepresentations. When a contract has been induced by fraudulent misrepresentations, it is open to the party defrauded either to sue for rescission of the contract or to sue for damages. In this case the party sued for rescission and in the end of the day he obtained a decree of reduction. The effect of that reduction was to restore things to their position at the date of the transaction reduced, with the result that as at that date and afterwards the successful pursuer in the action fell to be treated as having been the person in titulo of the shares which he had sold to the defender and therefore to have been in right of the dividends. No doubt it is true that in the interval the dividends had to be paid and were paid to the defender because his name stood in the register as the proprietor of the shares and no doubt also they were for the time being treated by the Inland Revenue as his income and while matters stood entire no other person had any right to the shares or to the dividends except the defender, Mr Crawford. But from the moment the reduction took place Mr Spence fell to be treated as having been throughout the proprietor of the shares and equally the person properly entitled to receive the dividends. On the other hand the Inland Revenue repaid to Mr Crawford the surtax attributable to the dividends actually paid to him by the company on the footing that he had never been in titulo to receive them.’

Judges:

Lord President Normand

Citations:

(1941) 24 TC 311

Jurisdiction:

Scotland

Cited by:

Distinguished – 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 – John Mander Pension Trustees Ltd v Revenue and Customs SC 29-Jul-2015
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 . .
Lists of cited by and citing cases may be incomplete.

Income Tax

Updated: 09 May 2022; Ref: scu.591247

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 payable directly to the child, because this would be more tax efficient. It was certainly more tax efficient for the future, because the child had no other income. But the Revenue assessed the wife to income tax on maintenance received by her between 1969 and 1979 without regard to the retrospective variation.
Held: The assessments were upheld.
Oliver LJ said: ‘A retrospective order cannot, any more than a retrospective agreement, undo the past and convert something that has already happened, and to which legal consequences have already attached, into something which never in fact did happen . . [In Spence] the restitutio in integrum represented by the court order obtained some years later did not so much reconstruct history as recognise and declare that which had all along been the legal position, although until the order the parties were in a state of some uncertainty as to what their rights were.’

Judges:

Oliver LJ

Citations:

[1986] Ch 31

Jurisdiction:

England and Wales

Citing:

Distinguished – 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 by:

Cited – John Mander Pension Trustees Ltd v Revenue and Customs SC 29-Jul-2015
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 . .
Lists of cited by and citing cases may be incomplete.

Income Tax

Updated: 09 May 2022; Ref: scu.591248

Jones (HM Inspector of Taxes) v O’Brien: 1988

Citations:

(1988) 60 TC 706

Jurisdiction:

England and Wales

Cited by:

Cited – Blackburn (HM Inspector of Taxes) v Keeling CA 21-Aug-2003
The tax payer sought to have reflected in his PAYE coding, his substantial trading losses arising from his activities as a Name /underwriter at Lloyds in 2003.
Held: The underwriting year 2003 ends in the year of assessment 2003/4, and . .
Lists of cited by and citing cases may be incomplete.

Income Tax

Updated: 09 May 2022; Ref: scu.185677

Saunders v Inland Revenue: HL 25 Jul 1957

Surtax – Settlement – Trustees empowered to release capital in excess of stated sum – Power to determine provision of settlement-Finance Act, 1938 (1 and 2 Geo. VI, c. 46), Sections 38 (2) and 41 (4) (b).

Citations:

[1957] UKHL TC – 37 – 416, (1957) 37 TC 416

Links:

Bailii

Jurisdiction:

England and Wales

Income Tax

Updated: 04 May 2022; Ref: scu.560138

Inland Revenue v National Coal Board: HL 29 May 1957

Profits Tax – Capital allowances – Industrial building or structure – Miners’ dwelling-houses-‘ likely to have little or no value to the person carrying on the trade when the mine … is no longer worked ‘ – Income Tax Act, 1945 (8 and 9 Geo. VI, c. 32), Section 8 (3); Finance Act, 1947 (10 and 11 Geo. VI, c. 35), Eighth Schedule, Part I, Paragraph 1.

Citations:

[1957] UKHL TC – 37 – 264

Links:

Bailii

Jurisdiction:

England and Wales

Income Tax

Updated: 04 May 2022; Ref: scu.560136

Owen (H M Inspector of Taxes) v Southern Railway of Peru, Ltd: HL 21 Jun 1956

Under Peruvian law the Respondent Company was bound to pay its employees in Peru prescribed compensation payments upon the termination of their services with the Company, subject to the fulfilment by the employee of certain conditions. The amount to be paid depended on (a) length of service and (b) rate of pay at the end of the period of service, except that a reduction in pay would not affect the amount to which an employee was entitled by reference to the period of service already performed. On appeal against assessments to Income Tax on the Company made under Case I of Schedule D for the years 1947-48 to 1951-52 inclusive, it was contended on behalf of the Company that upon proper principles of commercial accountancy amounts of compensation calculated to have accrued due to each employee from year to year as deferred remuneration should be allowed as a deduction. The Special Commissioners held that it was a matter of correct accountancy practice to make provision in the accounts for the sums in question, and allowed the appeal.

Citations:

[1956] UKHL TC – 36 – 602

Links:

Bailii

Jurisdiction:

England and Wales

Income Tax

Updated: 04 May 2022; Ref: scu.560143

Bradbury v English Sewing Cotton Co Ltd: 1923

Lord Phillimore discussed the possible taxation of dividends in the hands of shareholders: ‘Their taxation would seem to be logical, but it would be destructive of joint stock company enterprise. . . The reason for their [scil, the shareholders’] discharge may be the avoidance of double taxation, or to speak accurately, the avoidance of increased taxation.’

Citations:

[1923] AC 744

Jurisdiction:

England and Wales

Income Tax

Updated: 04 May 2022; Ref: scu.573167

Cull v Commissioners of Inland Revenue: HL 1940

Lord Atkin said: ‘My Lords, it is now clearly established that in the case of a limited company the company itself is chargeable to tax on its profits, and that it pays tax in discharge of its own liability and not as agent for its shareholders. The latter are not chargeable with income tax on dividends, and they are not assessed in respect of them. The reason presumably is that the amount which is available to be distributed as dividend has already been diminished by tax on the company, and that it is thought inequitable to charge it again.’
Lord Wright said: ‘the shareholder is not taxed under Schedule D in respect of that part of his income which consists of dividends. The profits have been charged to tax in the hands of the company and that fact is deemed to redound to his benefit.’

Judges:

Lord Atkin, Lord Wright

Citations:

[1940] AC 51

Jurisdiction:

England and Wales

Income Tax, Corporation Tax

Updated: 04 May 2022; Ref: scu.573166

London County Council v Attorney General: 1901

Lord MacNaghten said: ‘Income tax, if I may be pardoned for saying so, is a tax on income. It is not meant to be a tax on anything else.’
Lord Macnaghten said of a relator action: ‘The initiation of the litigation, and the determination of the question whether it is a proper case for the Attorney-General to proceed in, is a matter entirely beyond the jurisdiction of this or any other court. It is a question which the law of this country has made to reside exclusively in the Attorney-General’

Judges:

Lord MacNaghten

Citations:

[1901] AC 26

Jurisdiction:

England and Wales

Cited by:

Cited – Scottish Widows Plc v Revenue and Customs SC 6-Jul-2011
The taxpayer insurance company had transferred sums from accounts designated as Capital Reserves. The Revenue said that these were properly part of the profit and loss accounts for the respective tax years, and chargeable receipts.
Held: The . .
Cited – Gouriet v Union of Post Office Workers HL 26-Jul-1977
The claimant sought an injunction to prevent the respondent Trades Union calling on its members to boycott mail to South Africa. The respondents challenged the ability of the court to make such an order.
Held: The wide wording of the statute . .
Lists of cited by and citing cases may be incomplete.

Income Tax, Constitutional

Updated: 04 May 2022; Ref: scu.441626

Birmingham and District Cattle By-Products Co Ltd v Inland Revenue Commissioners: 1919

A company had not completed a full trade year before the outbreak of the First World War was required to obtain tax relief.

Judges:

Rowlatt J

Citations:

(1919) 12 TC 92

Jurisdiction:

England and Wales

Cited by:

Cited – Khan and Another v Miah and Others HL 7-Nov-2000
A partnership between a group intending to open a restaurant began when the parties joined together the find the premises, and fit it out. The partnership had come into existence even though they had not commenced trading by opening the restaurant. . .
Lists of cited by and citing cases may be incomplete.

Income Tax

Updated: 29 April 2022; Ref: scu.195498

National Westminster Bank Plc and Another and Barclays Bank Plc and Another v Inland Revenue Commissioners: ChD 6 Aug 1993

A business expansion tax plan was valid if it was issued before the Income and Corporation Taxes Act. Shares were issued on the sending of the allotment letter, not when the shares came to be registered in the company’s books.

Citations:

Ind Summary 30-Aug-1993, Times 06-Aug-1993

Statutes:

Income and Corporation Taxes Act 1988 289 299A

Jurisdiction:

England and Wales

Citing:

Appealed to – National Westminster Bank Plc and Another v Inland Revenue Commissioners CA 10-Jan-1994
Shares in Business Expansion Scheme were not to be treated as issued until they were entered in the company’s share register. The scheme was ineffective being a scheme to avoid Income Tax by financial manipulation. . .

Cited by:

Appeal from – National Westminster Bank Plc and Another v Inland Revenue Commissioners CA 10-Jan-1994
Shares in Business Expansion Scheme were not to be treated as issued until they were entered in the company’s share register. The scheme was ineffective being a scheme to avoid Income Tax by financial manipulation. . .
At First Instance – National Westminster Bank Plc and Another v Inland Revenue Commissioners HL 24-Jun-1994
Shares are allotted to a person when that person acquires an unconditional right to be entered on a company’s register of members. The issue of shares only becomes complete after they are registered in the company’s books for the purposes of the BES . .
Lists of cited by and citing cases may be incomplete.

Income Tax, Company

Updated: 28 April 2022; Ref: scu.84210

Coal Staff Superannuation Scheme Trustees Ltd v Revenue and Customs: UTTC 16 May 2018

INCOME TAX – pension fund lending overseas shares under stock lending arrangements – ICTA 1988, Sch 23A – manufactured overseas dividends (‘MODs’) representative of dividends on overseas shares – whether a difference in UK tax treatment between MODs and manufactured dividends representative of dividends on UK shares was a restriction on movement of capital – Art 56 EC Treaty; Art 63 TFEU – whether restriction justified by an overriding reason in the public interest – prevention of tax avoidance – balanced allocation of taxing powers – fiscal cohesion – remedy

Citations:

[2018] UKUT 152 (TCC), [2018] BTC 515, [2019] WLR(D) 544, [2018] STC 1095, [2018] 3 CMLR 35, [2018] STI 1049

Links:

Bailii, WLRD

Jurisdiction:

England and Wales

Cited by:

Appeal from – Revenue and Customs v Coal Staff Superannuation Scheme Trustees Ltd CA 3-Oct-2019
. .
At UTTx – Revenue and Customs v Coal Staff Superannuation Scheme Trustees Ltd SC 27-Apr-2022
The Respondent is the trustee of the British Coal Staff Superannuation Scheme, a registered pension fund holding a large portfolio of shares in UK and overseas companies. Between 2002 and 2008, the pension fund undertook a large number of ‘stock . .
Lists of cited by and citing cases may be incomplete.

Income Tax, European

Updated: 28 April 2022; Ref: scu.616367

Ystradyfodwg and Pontypridd Main Sewerage Board v Bensted: HL 19 Jun 1907

Held ( affirming the judgment of the Court of Appeal) that a sewer vested in and under control of a local authority is for the purpose of income-tax a hereditament capable of actual occupation, and is chargeable in respect of the annual value thereof according to Schedule A, Rule No. 1, of the Income-Tax Act 1842.

Judges:

Earl of Halsbury, Lords James of Hereford, Robertson, and Atkinson

Citations:

[1907] UKHL TC – 5 – 230, [1907] UKHL 622, 5 TC 230, 45 SLR 622

Links:

Bailii, Bailii

Jurisdiction:

England and Wales

Income Tax

Updated: 27 April 2022; Ref: scu.622298

De Beers Consolidated Mines, Ltd v Howe: HL 30 Jul 1907

A company, for purposes of income-tax, resides in the country in which its real business is carried on, which means the country in which its central management and control are actually located.

Judges:

Lord Chancellor (Loreburn), Lords Macnaghten, James of Hereford, Robertson, and Atkinson

Citations:

[1907] UKHL 626, 45 SLR 626, 44 SLR 626

Links:

Bailii

Jurisdiction:

England and Wales

Income Tax

Updated: 27 April 2022; Ref: scu.622301

Attorney General v London County Council: HL 19 Mar 1907

The annual income of the London County Council liable to, and on which they paid, income tax was pounds 956,000, consisting of pounds 838,000 derived from rents and co., and pounds 118,000, the annual value of landed property occupied by themselves. They had from time to time under their statutory powers created capital stock, which was charged upon their whole property. As interest on this stock they annually paid to shareholders (always deducting income tax due thereon), the sum of pounds 1,371,000, the amount by which their own income was insufficient to pay this interest being raised by means of rates. Admittedly, they were entitled to retain for themselves so much of the deducted income tax as represented the tax on their income from rents and other sources – London County Council v. Attorney-General [1901], A.C. 26. Held that they could not retain, but were bound to hand over to the Crown, the amount of tax representing the tax on the value of the lands owned and occupied by them (pounds 118,000).

Judges:

Lord Chancellor (Loreburn), Lords Macnaghten, James of Hereford, Robertson and Atkinson

Citations:

[1907] UKHL 1000, [1907] UKHL TC – 5 – 242, 5 TC 242

Links:

Bailii, Bailii

Jurisdiction:

England and Wales

Income Tax, Local Government

Updated: 27 April 2022; Ref: scu.622277

Usher’s Wiltshire Brewery Ltd v Bruce (Surveyor of Taxes): HL 4 Dec 1914

In the ordinary course of business as a brewery the appellants owned and let to tenants licensed premises, against the rents of which they claimed to set as a deduction in reckoning the profits expenditure incurred in respect of ( a) repairs, ( b) the difference between the actual and assessed rentals, ( c) insurance premiums, and ( d) legal costs in connection with the licences.
Held that all the deductions claimed ought to be allowed.

Judges:

Earl Loreburn, Lords Atkinson, Parker, Sumner, and Parmoor

Citations:

[1914] UKHL 894, [1914] UKHL TC – 6 – 399, [1915] AC 433, 6 TC 399, 52 SLR 894

Links:

Bailii, Bailii

Jurisdiction:

England and Wales

Income Tax

Updated: 26 April 2022; Ref: scu.620737

Mitchell v Egyptian Hotels Ltd: HL 9 Jul 1915

A company registered in London for the purpose of carrying on an hotel business in Egypt resolved that the company’s business should be carried on in Egypt by a local board independent of the home board (except that the latter fixed their remuneration). Only such part of the profits as was required for distribution as dividends in London and payment of home expenses was remitted home. The company was assessed to income tax under case 1 of Sched. D of section 100 of the Income Tax Act 1842 in respect of the whole of their profits, which were derived exclusively from the Egyptian business. The Court of Appeal, reversing Horridge, J., held that the control exercised by the board of directors in London was merely the control of the manner in which the profits arising from the carrying on of the business should be dealt with and did not amount to carrying on business, which was as and from the 27th August 1908 wholly carried on by the local board, and therefore the company was assessable to income tax on such profits only as were actually remitted to London.
The House, upon consideration, was equally divided in opinion, with the result that according to the practice of the house the appeal stood dismissed.
Decision of the Court of Appeal (reported 1914, 3 KB 118) affirmed.

Judges:

Earl Loreburn, Lords Parker, Sumner, and Parmoor

Citations:

[1915] UKHL 496, 53 SLR 496

Links:

Bailii

Jurisdiction:

England and Wales

Income Tax

Updated: 26 April 2022; Ref: scu.620693

Drummond v Collins: HL 10 Jun 1915

A testator, resident in America, by his will vested his property in trustees, and directed them in their discretion to apply the trust funds for the benefit of his grandchildren. The testator’s son’s widow was now resident in England with the children, and as guardian of the children received remittances from the trustees in America for their maintenance and education.
Held that these remittances were assessable to income tax under section 100, case 5, of the Income Tax Act 1842, Sched. D, as being moneys received in England in respect of foreign possessions.
Decision of the Court of Appeal reported [1914] 2 K.B. 643, affirmed.

Judges:

Earl Loreburn, Lords Atkinson, Parker, Sumner, and Wrenbury

Citations:

[1915] UKHL TC – 6 – 525, [1915] UKHL 527, 53 SLR 527, 6 TC 525

Links:

Bailii, Bailii

Jurisdiction:

England and Wales

Income Tax

Updated: 26 April 2022; Ref: scu.620687

Attorney General v Till: HL 8 Dec 1909

Income Tax – Incorrect Return – Penalty – Section 55 of the Income Tax Act, 1842.
Held, affirming Lord Advocate v. Sawe that the penalties imposed by Section 55 are incurred not merely by non-delivery of a return, but by delivering a return which is not true and correct.

Judges:

the Lord Chancellor (Loreburn), Lords Atkinson, Gorell, and Shaw

Citations:

[1910] AC 50, [1909] UKHL 601, [1909] UKHL TC – 5 – 440

Links:

Bailii, Bailii

Jurisdiction:

England and Wales

Income Tax

Updated: 25 April 2022; Ref: scu.620592

Edinburgh Life Assurance Co v Lord Advocate: HL 9 Dec 1909

Income Tax – Retention – Customs and Inland Revenue Act 1888.-The Appellants are a proprietary Company carrying on the business of life insurance and of selling annuities. On payment of the annuities they deduct Income Tax. The Appellants are not charged under the First Case of Schedule D, the receipts of the Company, apart from their income derived from investments and taxed at the source, being less than the expenditure. Including the taxed income there is a considerable surplus. The annuities are not paid out of the taxed income specifically, and are not charged on any particular fund but indiscriminately on the whole of the funds of the Company.
Held, that the annuities must be treated as payable out of the taxed income, so far as it will reach, and that, as the taxed income of the Appellants exceeds the annuities, they are entitled to retain the whole of the tax deducted from the annuities.

Citations:

[1910] AC 143, [1909] UKHL TC – 5 – 472

Links:

Bailii

Statutes:

Customs and Inland Revenue Act 1888

Jurisdiction:

England and Wales

Income Tax

Updated: 25 April 2022; Ref: scu.620595

Zyla v Staatssecretaris van Financien: ECJ 11 Jul 2018

Opinion – Preliminary ruling – Free movement of workers – Equal treatment – Income taxes – Social insurance contributions – Reduction of taxes and contributions – Worker having moved during the calendar year – Prorated reduction of the insured period

Citations:

C-272/17, [2018] EUECJ C-272/17 – O, ECLI:EU:C:2018:562, [2019] EUECJ C-272/17

Links:

Bailii, Bailii

Jurisdiction:

European

Income Tax, European

Updated: 25 April 2022; Ref: scu.620056

Old v Revenue and Customs: FTTTx 5 Jul 2018

Income Tax/Corporation Tax : Penalty – Income tax – Schedule 55 Finance Act 2009 – fixed and daily penalties for failure to file self-assessment returns on time – Appellant attempted to set up online account via Government Gateway but asserts he did not receive activation code – Appellant also asserts he did not receive paper return – defaults occurring over a period of two years – whether reasonable excuse – no – appeal dismissed

Citations:

[2018] UKFTT 366 (TC)

Links:

Bailii

Jurisdiction:

England and Wales

Income Tax

Updated: 25 April 2022; Ref: scu.619375