RBC reopens some old Ramsay uncertainties. Victoria Hine and Kyle Rainsford (Addleshaw Goddard) attempt to chart a course through.
Lord Nicholls once wrote that the principle in W T Ramsay Ltd v IRC [1982] AC 300 (Ramsay) ‘rescued tax law from being “some island of literal interpretation” and brought it within generally applicable principles’ of statutory interpretation (Barclays Mercantile Business Finance Ltd v Mawson [2004] UKHL 51) (Barclays). Despite Ramsay now being more than 40 years old the Supreme Court in Royal Bank of Canada v HMRC [2025] UKSC 2 (RBC) disagreed about when and how Ramsay applies.
The Ramsay principle
Ramsay set out two principles. First while the imposition of tax must be on the basis of ‘clear words’ this does not confine the courts to a literal interpretation; the context and purpose of the relevant legislation should be taken into account. Second the...
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RBC reopens some old Ramsay uncertainties. Victoria Hine and Kyle Rainsford (Addleshaw Goddard) attempt to chart a course through.
Lord Nicholls once wrote that the principle in W T Ramsay Ltd v IRC [1982] AC 300 (Ramsay) ‘rescued tax law from being “some island of literal interpretation” and brought it within generally applicable principles’ of statutory interpretation (Barclays Mercantile Business Finance Ltd v Mawson [2004] UKHL 51) (Barclays). Despite Ramsay now being more than 40 years old the Supreme Court in Royal Bank of Canada v HMRC [2025] UKSC 2 (RBC) disagreed about when and how Ramsay applies.
The Ramsay principle
Ramsay set out two principles. First while the imposition of tax must be on the basis of ‘clear words’ this does not confine the courts to a literal interpretation; the context and purpose of the relevant legislation should be taken into account. Second the...
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:
