Perminder Gainda looks at a recent decision of the First-tier Tribunal on the application of the principle that interest for individuals is generally taxable when received.
The taxpayer in Mazurkiewicz v HMRC [2011] UKFTT 807 (TC) (M) made a series of disastrous loans which resulted in the loss of his life savings. He was at risk of losing his home if HMRC succeeded in its case to charge him to tax in respect of interest paid on those loans. HMRC failed in its case however and this article discusses whether there was a legal basis to this decision or whether it should be regarded as an anomalous result motivated by a desire to avoid heaping further misery on M.
Facts
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