UT decides taxpayers did not benefit from motive exemption or qualify for treaty relief
Our pick of this week's cases
In A Davies & others v HMRC [2020] UKUT 67 (TCC) the Upper Tribunal (UT) found that the taxpayers did not satisfy the ‘motive exemption’ in the transfer of assets abroad (ToAA) legislation and could not benefit from treaty relief.
The taxpayers wanted to acquire an interest in a UK development property. The deposit was paid by an existing Isle of Man property investment company but that company did not complete the purchase as it would have become subject to tax on income rather than capital gains. Instead the purchase was made by a Mauritian company (ABP) where profits could benefit from a double tax treaty with the UK (the treaty). The FTT found the ToAA legislation applied to ABP’s profits and the taxpayers’ resulting deemed income could...
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UT decides taxpayers did not benefit from motive exemption or qualify for treaty relief
Our pick of this week's cases
In A Davies & others v HMRC [2020] UKUT 67 (TCC) the Upper Tribunal (UT) found that the taxpayers did not satisfy the ‘motive exemption’ in the transfer of assets abroad (ToAA) legislation and could not benefit from treaty relief.
The taxpayers wanted to acquire an interest in a UK development property. The deposit was paid by an existing Isle of Man property investment company but that company did not complete the purchase as it would have become subject to tax on income rather than capital gains. Instead the purchase was made by a Mauritian company (ABP) where profits could benefit from a double tax treaty with the UK (the treaty). The FTT found the ToAA legislation applied to ABP’s profits and the taxpayers’ resulting deemed income could...
If you or your firm subscribes to Taxjournal.com, please click the login box below:
If you do not subscribe but are a registered user, please enter your details in the following boxes:
.jpg?sfvrsn=335a554c_0 "300 x 250 (MPU)")