A round up of other news this week.
The Upper Tribunal has dismissed the taxpayer’s appeal in Travel Document Service and Ladbroke Group International v Commissioners for HMRC. The taxpayer group in this case had claimed a deduction in respect of the reduction in fair value of a shareholding in a group company which was deemed to represent a loan relationship. The deeming arose because the shares, in combination with a total return swap, were designed to produce an interest-like return. The First-tier Tribunal determined that the unallowable purpose rule applied to not only deny relief for this deduction (which was the intended benefit) but also for the interest debits in respect of loans transferred as part of the arrangement. The Upper Tribunal has upheld that decision. Although the facts are specific to the particular arrangement, the decision provides useful guidance as to how the Courts will apply the unallowable purposes rule.
Following the publication of updated draft legislation on the reform of the corporation tax loss relief rules on 26 January, HMRC have now circulated to interested parties a further update which includes provisions relating to oil and gas companies which were omitted from the last draft. Please speak to your usual KPMG contact if you have questions on this latest update.
The UK-Netherlands 2016 Double Taxation Convention Competent Authority Agreement on pension arrangements through insurance companies has been released, and came into force on 22 December 2016.
The draft Individual Savings Account (Amendment) Regulations 2017 have been published, which extend ISA tax advantages to investments held within an account after the death of the account holder.
A KPMG Employers’ Club online briefing will be held on Tuesday 21 February at 10am. James Reardon and Kathryn Batchelor will be discussing the future of company cars, looking at the different ways to fund a company car fleet and the impact of the recent announcements at Autumn Statement.
Food sales remain solid whilst non-food growth flags on the High Street, but online sales contribute to record non-food sales, according to the British Retail Consortium (BRC) and KPMG in the UK Retail Sales Monitor and Online Retail Sales Monitor for January.