UT/2023/000055 - [2025] UKUT 00028 (TCC)

In conclusion there was no error in the FTT holding that the PSA contract conferred benefit on Entertainment and that Entertainment was a relevant person being a person who was “party to” the arrangements which included the PSA contract. Given the facts before it and the matters that were not in dispute before the FTT, and in the light of Coconut UT, which we see no reason not to follow, Hoopla’s case fell squarely within Condition A of s178A and the arrangements were therefore “disqualifying arrangements”. The FTT was right to dismiss the appeal.

The above is sufficient to determine the appeal and uphold the two HMRC refusal of authorisation decisions (the first in respect of shares issued between 19 March 2018 and 28 August 2019, the second in respect of shares issued between 5 September 2018 and 19 October 2018) in HMRC’s favour. In their Response HMRC argue that the FTT was incorrect in finding in Hoopla’s favour on various other EIS conditions (Condition B in s178A(4A) ITA 2007, the trading requirement in s189 ITA 2007 and the Risk to Capital Condition (s157A ITA)). Those arguments are only relevant to disposal of the appeal before us in the event Hoopla’s appeal on Condition A was successful, which we have held it is not. We consider it preferable for the Upper Tribunal to hold off making pronouncements of the law in respect of those conditions to a case where such conditions are relevant to the outcome of the appeal.

Hoopla’s appeal is dismissed.