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UT (Tax & Chancery) UT/2023/000098 - [2024] UKUT 00404 (TCC)
Fecha: 16-Oct-2024
HMRC’s submissions
HMRC’s submissions
HMRC’s written submissions set out their position that the FTT had concluded that the Payment constituted earnings of MC. Mr Waldegrave referred to the Appellant’s challenge in its written submissions as being a very narrow one, namely that the FTT erred in law in concluding that the principal of the Loan fell to be regarded as earnings. HMRC submitted this was misconceived and aimed at the wrong target - the FTT had decided that the Payment to the Trustee comprised earnings; it was then immaterial what happened “downstream”. At the point at which the Loan was made, there were already earnings.
At the hearing Mr Waldegrave took the following approach:
HMRC’s headline response was that the FTT had found that the Payment was a payment of MC’s earnings and the Loan was irrelevant, or alternatively that the Loan was a loan of MC’s earnings – neither of these involved an error of law;
he drew attention to key findings of fact made by the FTT, including that the arrangements were prewired and that the Payment was made to enable the Trustee to make the Loan and that Loan was a reward for MC’s services;
he set out his submissions on the legal principles relevant to earnings, including HMRC’s position on when a loan may comprise a payment of earnings;
he addressed the reasoning of the FTT, submitting that the FTT’s discussion at [33] to [37] was obiter; and
he submitted that if we were to set aside and re-make the decision we should conclude that the Payment was earnings on the basis set out by Lord Hodge in Rangers SC.
- Heading
- Introduction
- Relevant legislation
- FTT Decision
- Arrangements concerning the EBT
- Approach and conclusions of the FTT
- Ground of appeal
- FTT’s consideration of whether the Loan was a reward or benefit
- Appellant’s submissions
- Exercise of discretion under s12 TCEA 2007
- Reasoning of the FTT in the Decision
- Whether the Decision involved the making of an error of law at [33] to [37]
- Correct outcome on re-making the decision
- HMRC’s submissions
- Headline response to ground of appeal
- Facts as found by the FTT
- Legal principles relevant to test for earnings
- Reasoning of the FTT in the Decision
- Correct outcome on re-making the Decision
- Discussion and conclusion
- Whether the Decision involved the making of an error of law
- Conclusions