US case: Altera, Arms Length Principle

Posted on

This is a reproduction of an article in LinkedIn by John Henshall, Deloitte London, that I thought was worth sharing. All credit to John. Thanks

Read the rest of this entry »

The UK First Tier Tribunal finds for HMRC on a Transfer Pricing point

Posted on Updated on

Abbey National Treasury Services Plc (ANTS) v HM Revenue & Customs (HMRC)

[2015] UKFTT 341 (14 July 2015)

This was an avoidance scheme, known as the Umbriel scheme, and involved UK-UK transfer pricing.

The issues in dispute between the parties were whether the £160 million debit claimed in ANTS’ tax return for the year ended December 2008 was deductible as a debit arising from ANTS’ derivative contracts under Schedule 26 of the Finance Act 2002 and whether the transfer pricing rules at Schedule 28AA of the Income and Corporation Taxes Act 1988 (now Part 4 Taxation (International and Other Provisions) Act 2010) applied to the Tracker Shares and if so, the extent to which they reduced the debit claimed by ANTS.

The FTT found for HMRC and ANTS’ appeal was dismissed.

The transfer pricing point has a potentially wide impact as it would appear to permit transfer pricing rules to be applied to ‘shareholder-type’ transactions which have traditionally been treated as falling outside their scope.
Read the rest of this entry »

Corporation tax: restriction of CT relief for business goodwill amortisation

Posted on Updated on

The July Budget removed corporation tax (CT) relief for companies who write off the cost of purchased goodwill and certain customer related intangible assets. Relief will still be available if the goodwill is sold. This measure will apply to all acquisitions made on or after 8 July 2015 unless made pursuant to an unconditional obligation entered into before that date. It also applies to all goodwill created on or after that date.

More detail here

HMRC United 4 Menda City 1 : City’s lacklustre defence no match for the United attack.’

Posted on Updated on

HM Revenue and Customs (HMRC) has defeated an artificial tax avoidance scheme involving the Brain Disorders Research Limited Partnership and Neil Hockin (one of the partners), after the First-Tier Tribunal ruled against the users’ attempts to claim £29 million in tax relief.

This is the latest in a series of tax tribunal wins for HMRC, with tribunals finding in HMRC’s favour in over 80 per cent of avoidance cases that taxpayers choose to litigate. Read the rest of this entry »