Main purpose test in applying the transactions in securities regime to buyback of EIS shares.
In H Osmond and another v HMRC [2024] UKFTT 378 (TC) (8 May) the First-tier Tribunal (FTT) dismissed the taxpayers’ appeals concerning share buybacks that were intended to crystallise CGT relief under the Enterprise Investment Scheme (EIS) deciding that in law they had a main purpose of obtaining an income tax advantage under the transactions in securities (TIS) anti-avoidance provisions.
The taxpayers were UK resident individuals who were serial entrepreneurs. They subscribed for EIS shares in a company called Xercise Ltd. It originally operated an unprofitable sports club business which was sold. However the taxpayers retained their shareholdings in the company and used it as a holding company to invest in another business. That business was later sold and the taxpayers interposed a new holding company (Xercise2 Ltd) to which the EIS...
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Main purpose test in applying the transactions in securities regime to buyback of EIS shares.
In H Osmond and another v HMRC [2024] UKFTT 378 (TC) (8 May) the First-tier Tribunal (FTT) dismissed the taxpayers’ appeals concerning share buybacks that were intended to crystallise CGT relief under the Enterprise Investment Scheme (EIS) deciding that in law they had a main purpose of obtaining an income tax advantage under the transactions in securities (TIS) anti-avoidance provisions.
The taxpayers were UK resident individuals who were serial entrepreneurs. They subscribed for EIS shares in a company called Xercise Ltd. It originally operated an unprofitable sports club business which was sold. However the taxpayers retained their shareholdings in the company and used it as a holding company to invest in another business. That business was later sold and the taxpayers interposed a new holding company (Xercise2 Ltd) to which the EIS...
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