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UT (Tax & Chancery) UT/2023/000103 - [2025] UKUT 00102 (TCC)
Fecha: 22-Ene-2025
Criticall
Criticall
As set out earlier in this decision:
The Criticall Pension Funding Deal concerned software valued by Dr Asher, who was experienced in IP valuation. He valued the software at £105,000, being a midpoint between £87,000 and £122,000, and Criticall assigned the IP rights in the software to its SSAS in exchange for a payment of £110,000; the SSAS agreed to lease the software back to Criticall for £2,750 per month for five years.
On 26 September 2016, HMRC issued Criticall with an assessment on the basis that the payment it had received from its SSAS of £110,000 for the sale of its software was an unauthorised payment subject to the unauthorised payments charge of 40% and a surcharge of 15%, so a total of £60,500; HMRC subsequently issued MLT with a scheme sanction charge of £44,000, being 40% of the unauthorised payment.
HMRC later accepted that the software was worth £85,000. The FTT say at [210] that they were not provided with information about how or why that valuation had been agreed, and there is no record in the FTT Decision of it using its power under TMA s 50(6)(c) to reduce either (a) the assessment on Criticall to the unauthorised payment, or (b) the assessment on MLT to the scheme sanction charge. However, we were not addressed on this point by either party (Footnote: 7).
- Heading
- Introduction
- The appeal grounds
- The Pension Funding Deals and the Employers
- The Legislation
- Payments by registered pension schemes
- Employer loans
- Scheme administration employer payments
- Charges
- Applications for discharge
- Factual background
- MLT and its associated companies
- The Pension Funding Deals generally
- The period up to 2011
- Prisym
- The Formwise Pension Funding Deal
- Langford
- The HMRC meetings
- Fraser
- Ballards
- The credit committee
- Criticall
- Gannon
- Overall approach to documentation
- Lack of challenge to the valuations
- The assessments
- The FTT Decision and the Grounds
- Ground 1: Domain names and websites
- The background
- Formwise
- The Formwise Contract
- The FTT Decision
- Mr Simpson’s submission relating to Mr Morris’ evidence
- Construction of the Formwise contract
- Conclusion
- The Langford Contract
- The evidence and findings of fact
- Construction of the Langford Contract
- Conclusion
- Submissions and our conclusions
- Overall conclusion on Ground 1
- Ground 2: Ballards loan
- The FTT’s approach and the finding
- Edwards v Bairstow challenge
- The other submission
- Ground 3: Gannon database
- Discussion
- Ground 4: Ballards trademark
- The first part of this Ground
- The second part of this Ground
- Our view
- Ground 5: time limits
- The assessment provisions
- The discharge provisions
- Mr Simpson’s submissions
- The Tribunal’s view
- Ground 6: Sending of applications
- Ground 7: Reasonable belief
- The statutory test
- The FTT’s assessment of the reasonable person
- A value judgment
- The FTT’s findings about all three transactions
- MLT’s case
- Ballards
- Mr Simpson’s submissions
- Criticall
- The FTT Decision
- Mr Simpson’s submissions
- Discussion
- Gannon
- Overall
- Ground 8: Just and Reasonable
- The statutory scheme
- The FTT’s Decision
- Mr Simpson’s submissions
- Conclusions