The tax payers had become involved in tax arrangements later fund to be tax avoidance.
Held: The appeal failed: ‘the materials before the FTT did not justify the attribution of any of the debits claimed by LGI to anything other than the ‘unallowable purpose’. LGI never supplied particulars of what loan(s) it claimed would have been made to it at what rate(s) of interest and for what period(s) had it not adopted the Deloitte scheme. No such details were, for example, given in LGI’s Notice of Appeal to the FTT, which simply contended that ‘the deductions for interest are allowable for corporation tax purposes’ and that ‘the non-trading loan relationship debits should be allowed against trading profits’. Again, Mr Turner’s witness statement said that the Novations ‘could have been replaced by the payment of dividends’, but did not expand on how or, in particular, what (if anything) LGI would have borrowed for the purpose. ‘
Citations:
[2018] EWCA Civ 549
Links:
Jurisdiction:
England and Wales
Corporation Tax
Updated: 06 April 2022; Ref: scu.606480