In C Collins v HMRC (TC02088 – 5 July) a British citizen (C) had been marketing director of a UK subsidiary of an American company (R) which was controlled by a wealthy married couple. The couple subsequently divorced and the wife (D) acquired control of R. In 1994 C resigned his directorship without receiving any compensation. He rejoined R in 1997 after D had sold her shares to another company (H). In 1998 D paid C $2m. C did not declare this on his tax return. Subsequently following an enquiry into undeclared bank interest HMRC formed the opinion that the $2m had been an emolument from C’s employment with R. C appealed contending that it had been a personal gift from D and was not taxable. The First-tier Tribunal accepted this contention and allowed the appeal. Judge Nowlan observed that D...
