Executors of Cox v Commissioners for HMRC [2020] WTLR 1239
Winter 2020 #181This case was an appeal against a notice of determination issued by HMRC under s221 Inheritance Tax Act 1984 (IHTA) which had ruled that the deceased’s furnished holiday lettings business did not qualify for business property relief (BPR). The only dispute was whether the business consisted ‘mainly’ of ‘holding investments’ within the meaning of s105(3) IHTA.
The business began in 1989 with one flat and expanded in 1991 and 1996 with the purchase of further flats in the same building. It continued until the deceased’s death on 27 December 2014.
The tribuna...
Shelford & anr v HMRC [2020] WTLR 657
Summer 2020 #179John Selwyn Herbert (Mr Herbert), a widower with three children, owned and lived in the freehold house, 12 Hammersmith Terrace, London (the house). In 2001, Mr Herbert obtained inheritance tax advice from Stevens & Bolton to implement what was described as the ‘home loan scheme’ and he asked the second appellant, Mr Shelford, who was a solicitor and partner in Edwin Coe, to act as a trustee of the Herbert Life Interest Settlement (the settlement).
The settlement, which was dated 21 March 2002, was established by Mr Herbert with a nominal sum of £10 upon trust for himself durin...
Charnley & anr v HMRC [2020] WTLR 93
Spring 2020 #178Mr Gill’s estate included the house in which he lived, a brick barn and outbuildings and 21 acres of permanent pasture. During the relevant period Mr Gill did not own any livestock. He allowed farmers to graze their livestock on his agricultural land under annual grazing licences. It was not disputed that the house was of a character appropriate to the farm.
HMRC refused agricultural property relief (‘APR’) in respect of the value of the house, barn and outbuildings on the basis that neither the house nor outbuildings were occupied for the purposes of agriculture, and refused the ...
Banks v HMRC [2020] WTLR 19
Spring 2020 #178The appellant taxpayer, Arron Banks, appealed against a notice of determination issued by HMRC. This notice assessed Mr Banks as owing inheritance tax of £162,945.34 on donations of £976,781.38 that he and companies that he controlled made to the UK Independence Party (UKIP) between October 2014 and March 2015 (the donations).
It was common ground that no UKIP MPs were elected at the 2010 UK General Election. UKIP did not therefore meet the statutory definition under s24(2) IHTA 1984 and so the Donations were not treated as exempt from VAT. The appellant argued that this ...
Rialas v HMRC [2019] WTLR 1251
Winter 2019 #177During the relevant tax years, R was resident and ordinarily resident, but not domiciled, in the United Kingdom. He was a Cypriot national. He held 50% of the issued shares of ACM, a company incorporated in England and Wales. R worked full time in ACM, which carried on a successful business as a fund manager. C held the other 50% of the shares of ACM.
In order to sell his shares in ACM, R decided to acquire C ‘s shares in ACM using a trust and a company resident outside the UK and borrowed funds, also from an offshore company. R established the R Trust, a discretionary family trus...
The Quentin Skinner 2005 Settlement L & ors v HMRC [2019] WTLR 1389
Winter 2019 #177On 1 December 2015 three settlements (“the Skinner Settlements”) disposed of 55,000 ordinary shares (“the Shares”) in a company (“the Company”) at a gain. Under each Skinner Settlement a member of the Skinner family had been given an interest in possession in the whole of the settled property on 30 July 2015.
Following the disposal of the Shares, the Skinner Settlements and their respective Beneficiaries (“the Beneficiaries”) claimed entrepreneurs ‘ relief (“ER”) under s169J of the Taxation of Chargeable Gains Act 1992 (“TCGA 1992“) applying a reduced ra...
Kersner v HMRC [2019] WTLR 895
Autumn 2019 #176On an appeal against HMRC’s determination of liability to inheritance tax the appellant made a number of applications in the First-Tier Tribunal (Tax Chamber), including an application to opt out of the complex track costs regime, and for disclosure of documents alleged to be relevant to the HMRC’s assessment that the appellant had not been domiciled in the UK, but in Israel, when shares had been transferred to her by her husband. The appellant contended that she was UK domiciled at the time of the gift and that the spousal exemption applied.
The tribunal wrote to the appellant on...
Hogarth v HMRC [2019] WTLR 79
Spring 2019 #174The appellants were trustees of a life interest trust, the income of which was mandated to the life tenant and passed directly to him. HMRC served a notice under s8A of the Taxes Management Act 1970 to file an income tax return on the trustees. When no return was filed, HMRC assessed penalties against the trustees for failure to file the return by the due date. The trustees appealed to the First-Tier Tribunal against the decision of HMRC to reject their appeals, arguing that they thought a return had been filed by their previous agents, that given that the return was a ...
Graham (Deceased) v HMRC [2018] WTLR 911
Autumn 2018 #173The deceased owned a property, Carnwethers, on the Isles of Scilly, from which she ran self-catering holiday accommodation business, as well as occasional bed-and-breakfast accommodation. There were four self-catering apartments which were well-furnished and provided with numerous additional amenities, and particularly assiduous concierge assistance from the owners. On her death HMRC issued a notice of determination refusing business property relief on any of the value of Carnwethers on the basis that the business consisted mainly of the holding of an investment.
The deceased’s pe...
Harris v HMRC [2018] WTLR 119
Spring 2018 #171HMRC successfully applied to strike out Mr Harris’ appeal against an inheritance tax determination, under Rule 8 of the Tribunal Procedure (First-Tier Tribunal) (Tax Chamber) Rules 2009. Mr Hughes was appointed as Administrator of the deceased’s estate in June 2013. HMRC opened an enquiry into the IHT400 he filed, and determined that the IHT payable was £341,278.76. Mr Harris requested a statutory review of this determination; this upheld the determination. Mr Harris appealed against the findings of this review, though he did not challenge the quantum of the determination.
The b...