Group transfer rules and swap contracts

Table of contents

• Original news
• What was the main issue in this case?
• What is the purpose of the group rules in the derivatives regime?
• Why was the transaction contested?
• Was the decision surprising? Do you expect it to be appealed?
• Does the case represent a more aggressive approach by HMRC?
• What lessons should lawyers draw from this case?
• What did the tribunal have to say about the issue of closure notices?

Article summary

Tax analysis: The First-tier Tax Tribunal’s rejection of an attempt by a bank to take advantage of the derivative contract group transfer rules (originally in the Finance Act 2002) to avoid corporation tax by transferring a swap contract to another company in the same banking group is examined by solicitor Kevin Conway, a tax partner at King & Spalding.