In R Sutton v HMRC (TC01606 – 9 December) an individual (S) had purchased an insurance policy in 1994. In 2004 the insurer changed the terms of the policy. S complained to the Financial Services Authority. In 2008 following prolonged negotiations involving the Financial Ombudsman Service the insurer agreed to refund S’s premiums with interest at 8% p.a. The insurer deducted tax from the interest. S appealed to the First-tier Tribunal contending that the whole of the repayment including the interest should be treated as capital. The Tribunal rejected this contention and dismissed the appeal.
Why it matters: The Tribunal upheld HMRC’s view that tax had been correctly deducted from the interest.
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:
In R Sutton v HMRC (TC01606 – 9 December) an individual (S) had purchased an insurance policy in 1994. In 2004 the insurer changed the terms of the policy. S complained to the Financial Services Authority. In 2008 following prolonged negotiations involving the Financial Ombudsman Service the insurer agreed to refund S’s premiums with interest at 8% p.a. The insurer deducted tax from the interest. S appealed to the First-tier Tribunal contending that the whole of the repayment including the interest should be treated as capital. The Tribunal rejected this contention and dismissed the appeal.
Why it matters: The Tribunal upheld HMRC’s view that tax had been correctly deducted from the interest.
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:
