Weekly case highlights ― 19 April 2021

Produced by Tolley
Weekly case highlights ― 19 April 2021

The following Owner-Managed Businesses guidance note Produced by Tolley provides comprehensive and up to date tax information covering:

  • Weekly case highlights ― 19 April 2021
  • Business tax
  • Zyrieda Denning and others v HMRC
  • M Group Holdings Ltd v HMRC
  • Euromoney Institutional Investor plc v HMRC
  • Charlton Chauffeur Drive Ltd v HMRC
  • Employment tax
  • Stephen Hoey v HMRC
  • Jonathan Hayden v HMRC
  • VAT
  • More...

These are our brief notes and thoughts on cases published in the last week or so which caught our eye and are likely to be of particular interest to tax practitioners. Full case reports and commentary on most of these cases will be included within our normal reference sources in the coming weeks.

Business tax

Zyrieda Denning and others v HMRC

This is a valuation case but it will be of interest to all involved in the taxation of business acquisitions and disposals as it concerns the nature of goodwill and how it should be valued. In particular it looks at the question of property-based goodwill, such as in a pub or nursing home, where the profitability of a business is inextricably tied up with the property from which it operates. Those specialising in valuation will need to read the case but it also has much of interest for all involved in the taxation of businesses.

M Group Holdings Ltd v HMRC

This is a case about substantial shareholding exception, which applies (broadly) when one company sells shares in another company it owns. The normal rule is that the shares must have been owned for at least 12 months, but in some circumstances a provision applies to deem a 12-month ownership period where in fact shares have not been owned that long. The tribunal had to determine how those deeming provisions applied when there was no pre-existing group. Both HMRC’s and the taxpayer’s interpretations created anomalies and the tribunal ultimately had to decide what Parliament’s intention was when amending the relevant legislation to bring in the sections under discussion. It found in favour of HMRC’s argument and thus denied the relief but there is no denying that the legislation here is not well drafted. Anybody interested in the finer points of statutory interpretation will find much to ponder here.

Euromoney Institutional Investor plc v HMRC

Share-for-share exchanges are a familiar part of the way in which acquisitions and disposals

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