In MJP Media Services Ltd v HMRC (TC00586 – 2 August) a company (M) claimed a corporation tax deduction of £6 690 000 in relation to certain transactions with an associated company. HMRC rejected the claim and M appealed contending that the transactions constituted a ‘loan relationship’ within the definition in FA 1996 s 81 (see now CTA 2009 ss 302 303). The First-Tier Tribunal rejected this contention and dismissed the appeal observing that ‘the companies had apparently not retained copies of their bank statements’ and commented that ‘it is hard to understand why this basic documentation was not available to explain the transactions’. On the evidence M had failed to show that there had been a ‘lending of money’ within s 81.
Why it matters: It is important to present adequate evidence in support of any appeal....
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In MJP Media Services Ltd v HMRC (TC00586 – 2 August) a company (M) claimed a corporation tax deduction of £6 690 000 in relation to certain transactions with an associated company. HMRC rejected the claim and M appealed contending that the transactions constituted a ‘loan relationship’ within the definition in FA 1996 s 81 (see now CTA 2009 ss 302 303). The First-Tier Tribunal rejected this contention and dismissed the appeal observing that ‘the companies had apparently not retained copies of their bank statements’ and commented that ‘it is hard to understand why this basic documentation was not available to explain the transactions’. On the evidence M had failed to show that there had been a ‘lending of money’ within s 81.
Why it matters: It is important to present adequate evidence in support of any appeal....
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