Court of Appeal finds that distributions debited to company’s share premium account were dividends that were not capital in nature
In A Beard v HMRC [2025] EWCA Civ 385 (2 May) the Court of Appeal (CA) upheld decisions of the First-tier Tribunal (FTT) and Upper Tribunal (UT) that distributions the taxpayer received from an overseas company which were debited from the company’s share premium account were dividends that were not capital in nature and were therefore chargeable to income tax.
ITTOIA 2005 s 402(1) imposes a charge to income tax on dividends of non-UK resident companies. Section 402(4) provides that dividends do not include ‘dividends of a capital nature’. Apart from this caveat the legislation does not define ‘dividend’. The Explanatory Notes to the Bill that became ITTOIA 2005 state that identifying a dividend ‘will usually be a matter of referring to the relevant company law’....
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Court of Appeal finds that distributions debited to company’s share premium account were dividends that were not capital in nature
In A Beard v HMRC [2025] EWCA Civ 385 (2 May) the Court of Appeal (CA) upheld decisions of the First-tier Tribunal (FTT) and Upper Tribunal (UT) that distributions the taxpayer received from an overseas company which were debited from the company’s share premium account were dividends that were not capital in nature and were therefore chargeable to income tax.
ITTOIA 2005 s 402(1) imposes a charge to income tax on dividends of non-UK resident companies. Section 402(4) provides that dividends do not include ‘dividends of a capital nature’. Apart from this caveat the legislation does not define ‘dividend’. The Explanatory Notes to the Bill that became ITTOIA 2005 state that identifying a dividend ‘will usually be a matter of referring to the relevant company law’....
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