Andrew Roycroft (Norton Rose Fulbright) reviews the decision in the case of Bupa Insurance, which serves as a reminder that a tax avoidance purpose is, of itself, not sufficient for HMRC to deny a taxpayer its intended tax outcome
The Upper Tribunal has decided when beneficial entitlement to income from (and beneficial ownership of) an asset – here shares – will be retained despite contractual arrangements which severely limit the owner’s exposure to the risks and rewards of ownership (Bupa Insurance [2014] UKUT 0262 (TCC).)
This decision concerned an arrangement reported under the DOTAS rules which was intended to allow Bupa Insurance to access certain carried forward tax losses arising to a previously unrelated reinsurance company (CX Re). This involved making an election under FA 2000 s 107(4) to convert those carried...
