In Greene King v HMRC (FTC/72/2012 – 22 April 2014) the UT held that a loan relationship scheme marketed by Ernst & Young failed.
Greene King PLC (GKPLC) had lent £300m to another company of the same group Greene King Brewing (GKB) on which interest was payable periodically and the principal at the end. GKPLC had then assigned to its subsidiary Greene King Acquisitions (GKA) the right to receive the remainder of the interest (but had retained the right to the capital). GKA had issued preference shares carrying a special dividend to GPLC as consideration for the assignment.
The Greene group contended that GKPLC was no longer taxable on the interest (except for the special dividend of £975 000) GKB was entitled to a deduction on the interest payable (£21.3m) and GKA was only taxable on £768 000 (the...
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In Greene King v HMRC (FTC/72/2012 – 22 April 2014) the UT held that a loan relationship scheme marketed by Ernst & Young failed.
Greene King PLC (GKPLC) had lent £300m to another company of the same group Greene King Brewing (GKB) on which interest was payable periodically and the principal at the end. GKPLC had then assigned to its subsidiary Greene King Acquisitions (GKA) the right to receive the remainder of the interest (but had retained the right to the capital). GKA had issued preference shares carrying a special dividend to GPLC as consideration for the assignment.
The Greene group contended that GKPLC was no longer taxable on the interest (except for the special dividend of £975 000) GKB was entitled to a deduction on the interest payable (£21.3m) and GKA was only taxable on £768 000 (the...
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