[2025] UKUT 061 (AAC)

Between:

IRD

Appellant

- v -

HIS MAJESTY’S REVENUE & CUSTOMS

Respondent

Before: Upper Tribunal Judge Church

Decided on consideration of the papers

Representation:

Appellant: Not represented

Respondent: Elisa Collins of HMRC Solicitor’s Office and Legal Services

On appeal from:

Tribunal: The First-tier Tribunal (Social Entitlement Chamber)

Tribunal Case Nos: SC286/23/00074/75

Tribunal Venue: Gloucester

Decision Date: 31 January 2024

Date of Issue: 6 February 2024

Anonymity: The appellant in this case is anonymised in accordance with the practice of the Upper Tribunal approved in Adams v Secretary of State for Work and Pensions and Green (CSM) [2017] UKUT 9 (AAC), [2017] AACR 28.

SUMMARY OF DECISION

TAX CREDITS AND FAMILY CREDIT (33) 33.7 (other)

This decision is mainly about the proper interpretation of, and proper approach to, the conditions to entitlement for working tax credit under the Tax Credits Act 2002 (the “2002 Act”) and the Working Tax Credit (Entitlement and Maximum Rate) Regulations 2002 (the “2002 Regulations”)

The Appellant claimed working tax credit on the basis that he was over 60 and worked over 16 hours a week in his business trading financial futures as principal. He argued he was “self-employed” for the purposes of Regulations 2(1) and 4(1) of the 2002 Regulations and was engaged in “qualifying remunerative work” for the purposes of Section 10 of the 2002 Act.

The Upper Tribunal considers what it means for an activity to be carried out “on a commercial basis” and “with a view to the realisation of profits”.

It decides that, while the requirement for an activity to be carried on “with a view to the realisation of profits” does not require it to be profitable, or for there to be anything like certainty as to its future profits, there must be more than a mere intention or hope that it will become profitable. It requires a realistic expectation of profit in the foreseeable future, and a credible plan of how to achieve it.

The Upper Tribunal also explains that the Appellant’s trading of financial futures solely as principal can’t satisfy the fourth condition in regulation 4 of the 2002 Regulations because none of the payments that he receives (or may expect to receive) is payment for the work he does.

Both appeals dismissed.

Please note the Summary of Decision is included for the convenience of readers. It does not form part of the decision. The Decision and Reasons of the judge follow.

DECISION