In Shiner and other v HMRC [2020] UKFTT 295 (TC) (17 July 2020) the First-tier Tribunal dismissed the taxpayers’ argument that loans to partners should be treated as loans to the partnership and also held that there was no deduction from a partner’s share of profits for interest on a loan to the partner to finance a capital contribution to the partnership.
The appellants were business partners and directors of a property development group in the UK. They had entered into a tax avoidance scheme using Isle of Man trusts. Those trusts entered into a partnership in the IOM (the ‘Redwood partnership’) with a view to carrying on the trade of property development. The appellants were entitled to the profits of Redwood in equal shares.
The trustees of the IOM trusts entered into loan agreements with another entity in the UK...
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In Shiner and other v HMRC [2020] UKFTT 295 (TC) (17 July 2020) the First-tier Tribunal dismissed the taxpayers’ argument that loans to partners should be treated as loans to the partnership and also held that there was no deduction from a partner’s share of profits for interest on a loan to the partner to finance a capital contribution to the partnership.
The appellants were business partners and directors of a property development group in the UK. They had entered into a tax avoidance scheme using Isle of Man trusts. Those trusts entered into a partnership in the IOM (the ‘Redwood partnership’) with a view to carrying on the trade of property development. The appellants were entitled to the profits of Redwood in equal shares.
The trustees of the IOM trusts entered into loan agreements with another entity in the UK...
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