Stagecoach, loan relationships and the ‘fairly represents’ rule

In the Stagecoach case, a complex intra-group financing scheme failed before the FTT. A loan was derecognised with a matching debit to an investment in a subsidiary, but the debit was not ‘in respect of’ the loan relationship, and in any case the debit did not ‘fairly represent’ a loss. Any taxpayer still in dispute with HMRC over an intra-group financing scheme is likely to have an uphill struggle.