This year saw the publication of three judgments from the Court of Appeal (CA) affirming a wide application of the loan relationships unallowable purpose test. The first of these was BlackRock Holdco 5 LLC v HMRC [2024] EWCA Civ 330 (11 April) where the court held that interest payments on intra-group loans put in place as part of the funding structure for a commercial acquisition were not restricted by transfer pricing rules but were disallowed under the loan relationships unallowable purpose rule.
In this case the taxpayer (LLC5) was a Delaware-incorporated UK resident company formed as part of the structure for the acquisition by the BlackRock group of the Barclays Global Investor business in 2009. LLC5 issued several tranches of loan notes to its immediate parent company LLC4 and claimed non-trading loan relationship debits for the interest paid on the loans over a...
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This year saw the publication of three judgments from the Court of Appeal (CA) affirming a wide application of the loan relationships unallowable purpose test. The first of these was BlackRock Holdco 5 LLC v HMRC [2024] EWCA Civ 330 (11 April) where the court held that interest payments on intra-group loans put in place as part of the funding structure for a commercial acquisition were not restricted by transfer pricing rules but were disallowed under the loan relationships unallowable purpose rule.
In this case the taxpayer (LLC5) was a Delaware-incorporated UK resident company formed as part of the structure for the acquisition by the BlackRock group of the Barclays Global Investor business in 2009. LLC5 issued several tranches of loan notes to its immediate parent company LLC4 and claimed non-trading loan relationship debits for the interest paid on the loans over a...
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