No error by FTT in applying unallowable purpose rules.
In JTI Acquisitions Company (2011) Ltd v HMRC [2023] UKUT 194 (TCC) (7 August 2023) the Upper Tribunal (UT) dismissed the taxpayer’s appeal against the First-tier Tax Tribunal (FTT) decision that the unallowable purpose rules applied such that all of the loan relationship debits in respect of the interest paid should be denied.
The taxpayer a UK company and part of a US-headquartered multinational group sought to apply debits in respect of the arm’s length interest it paid on an intra-group US$550m loan (which was used to part-fund the acquisition of another US-based corporate group).
HMRC had denied the debits on the basis of the unallowable purpose rules in of CTA 2009 s 441 and s 442). Where the rules apply the deduction of loan interest by the loan debtor that would otherwise arise is denied but...
If you or your firm subscribes to Taxjournal.com, please click the login box below:
If you do not subscribe but are a registered user, please enter your details in the following boxes:
No error by FTT in applying unallowable purpose rules.
In JTI Acquisitions Company (2011) Ltd v HMRC [2023] UKUT 194 (TCC) (7 August 2023) the Upper Tribunal (UT) dismissed the taxpayer’s appeal against the First-tier Tax Tribunal (FTT) decision that the unallowable purpose rules applied such that all of the loan relationship debits in respect of the interest paid should be denied.
The taxpayer a UK company and part of a US-headquartered multinational group sought to apply debits in respect of the arm’s length interest it paid on an intra-group US$550m loan (which was used to part-fund the acquisition of another US-based corporate group).
HMRC had denied the debits on the basis of the unallowable purpose rules in of CTA 2009 s 441 and s 442). Where the rules apply the deduction of loan interest by the loan debtor that would otherwise arise is denied but...
If you or your firm subscribes to Taxjournal.com, please click the login box below:
If you do not subscribe but are a registered user, please enter your details in the following boxes:
