Tax Journal’s recent coverage of the Keighley case has largely focused on connected companies issues. Here, Mark Whitehouse and Mairead Cummins (PwC) focus on the other key issue in that case: the ‘gateway test’ for the deductibility of loan relationship debits.
The deductibility of loan relationship debits arising from the partial write-off of a secured loan was the subject of a recent decision by the First-tier Tribunal (FTT)in Keighley and another v HMRC [2024] UKFTT 30 (TC). The case involved a company Primeur Ltd (‘Primeur’) that had lent money to another company Valley Dale Properties Ltd (‘VDP’) secured by a charge over VDP’s property. The FTT had to determine whether VDP was a connected company of Primeur under CTA 2009s 466 or whether the write-off of part of the secured loan by Primeur had an unallowable purpose under CTA 2009 s 441 which would prevent...
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Tax Journal’s recent coverage of the Keighley case has largely focused on connected companies issues. Here, Mark Whitehouse and Mairead Cummins (PwC) focus on the other key issue in that case: the ‘gateway test’ for the deductibility of loan relationship debits.
The deductibility of loan relationship debits arising from the partial write-off of a secured loan was the subject of a recent decision by the First-tier Tribunal (FTT)in Keighley and another v HMRC [2024] UKFTT 30 (TC). The case involved a company Primeur Ltd (‘Primeur’) that had lent money to another company Valley Dale Properties Ltd (‘VDP’) secured by a charge over VDP’s property. The FTT had to determine whether VDP was a connected company of Primeur under CTA 2009s 466 or whether the write-off of part of the secured loan by Primeur had an unallowable purpose under CTA 2009 s 441 which would prevent...
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