- Upper Tribunal agrees buying partnership interests can be deductible for financial dealers (Investec v HMRC)
- What are the practical implications of this case?
- What was the background?
- What did the court decide?
- Capital v Revenue
- Wholly and exclusively
- Closure notice
- Calculations of taxable profits
- Case details
Tax analysis: The Upper Tribunal (UT) found that the costs of acquiring partnership interests were revenue expenditure incurred wholly and exclusively for the purposes of the companies’ financial dealing trades (upholding the First-tier Tribunal (FTT)); but that capital contributions into the partnerships were not so wholly and exclusively incurred (overturning the FTT). The UT also upheld the FTT’s conclusion that arguments raised in the cover letter accompanying a closure notice could be used as the basis of arguments in the Tribunal. However, the UT declined to determine the final issue about whether taxed partnership profits had to be brought into the tax computation of the partners’ financial dealing trades.
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