Vaccine Research Limited Partnership and another v HMRC

In Vaccine Research Limited Partnership and another v HMRC [2025] UKFTT 402 (TC) (4 April) the First-tier Tribunal (FTT) found that licence fees received as part of a complex scheme intended to generate income tax losses were not income and so not subject to income tax.

The appellants were a limited partnership and one of the partners. They entered into a scheme intended to generate income tax losses for the partners by way of research and development capital allowances. The scheme was held to be largely ineffective by the Upper Tribunal (UT) in 2014 (see Vaccine Research Limited Partnership and another v HMRC [2014] UKUT 359 (TC)) the capital allowances being allowed in respect of only £14m of expenditure rather than the £193m originally claimed. One feature of the scheme was the guaranteed receipt of licence fees by the partners...