Tax Tribunal guidance
Where two or more cases give rise to common or related issues of fact or law, Tribunal Procedure Rule 18 permits the Tribunal to specify one (or more) case as a lead case and stay (or in Scotland, sist) the other cases.
These cases have been specified as lead cases under Rule 18:
|Rule 18 direction||Specified Lead Case||Tribunal reference||Common or related issues of fact or law|
|2 June 2011 Judge Kempster||Tower Radio Limited and Total Property Support Services Limited||TC/2009/10778||Whether the sums or benefits received by officers or employees pursuant to arrangements registered as Disclosed Tax Scheme 54003391 and adopted by the lead case appellants and others during the tax years 2003-04 and/or 2004-05 are:
1.chargeable to income tax as employment income, and, if so, as PAYE income; and/or
2. constitute earnings liable for National Insurance Contributions.
|2 June 2011 Judge Kempster||Nuffield Health and others||TC/2010/4122||The common or related issues of law are:
1. Whether or not the provision of pharmaceutical supplies and/or the supply and surgical fitting of prostheses, such as artificial hip joints or pacemakers , to patients were at the relevant times part of a single exempt supply or zero rated for the purposes of Value Added Tax Act 1994; and
2. Accordingly, whether or not the Appellants can recover the attributable input tax on such expenditure incurred in the course of private "in-patient" treatment prior to 1997;
being issues of law arising from appeals brought against the Respondents on the basis of the majority decision of the Court of Appeal in Customs and Excise Commissioners v Wellington Private Hospital Ltd  STC 445 following the House of Lords' decision in Fleming v Revenue and Customs Commissioners  STC 324
|31 August 2011 Judge Bishopp||The Sussex appeals (Green King et al)||TC/2010/02176||
The common or related issues of fact are:
1. One company ("the Lender") lends to a group company ("the borrower"). This is represented by the creation and issue by the Borrower of unsecured loan stock with an equivalent nominal value.
2. The Lender is the sole holder of all the loan stock..
3. The terms of the loan stock were that it would bear interst at a rate that would be fixed during the material time1.
4. The Lender assigned its right to receive interst on the loan stock to a third company ("the assignee"). In consideration of the right to receive the interest, the assignee issued preference shares to the Lender.
5. The preference shares carried the right to a 'Special Dividend' or initial dividend and thereafter the right to an annual dividend.
6. The Lender gave notice to the Borrower of the assignment and directed the Borrower to make interest payments to the Assignee.
7. The Special Dividend was declared by the Assignee, and paid to the Lender.
8. The Borrower paid interest on the loan to the Assignee.
9. The right to receive repayment of the loan principal remained with the Lender.
1. Some loan stock had rates that were subject to annual change. Other loan stock had rates that were fixed throughout their term. Nothing turns on this distinction, as any changes are outside the material time.The common or related issues of law are:
1. Whether the consideration for the assignment of the Lender's right to interest is the issue of the preference shares by the Assignee, the value of which should have been brought into the Lender's accounts.
2. Whether the loan relationship credit arises in the Lender by reason of the accounting treatment, in particular under para 71 FRS 5, arising out of the transfer of the right to receive interest from the loan,
3. Whether there was a loan relationship between the borrower and the assignees, and, if not, whether the receipts are taxable under Cases III or VI of Schedule D in the hands of the assignee,
4. Whether an amount was required to be transferred to the Assignees' share premium account on the issue of its preference shares to the Lender within the meaning of s84(2)(a) FA96.
|31 January 2011 Judge Berner||
Taylor Wimpey Developments Ltd,
The common or related issues of fact and law are:
The Transactions have the following fact pattern:
The following arguments are common to the appeals:
|3 October 2012 Judge Berner||Further directions The common issue of law is: Whether it necessarily follows that the Borrower has a tax avoidance purpose which is a main purpose within the meaning of paragraph 13 of Schedule 9 to the Finance Act 1996 where, as in this case,
(a) the only reason for the borrowing's design structure and terms was to obtain a tax advantage for the Lender and/or the Share Recipient (in that the entirety of any payments made by the Borrower would escape tax altogether in the hands of the Lender and the Share Recipient),
(b) the Lender, the Share Recipient and the Borrower all knew at the time of entering into the borrowing that the borrowing was designed and structured so that the Lender and/or the Share Recipient would obtain the tax advantage, and irrespective of the further fact that the Borrower had a commercial need for the borrowing, and irrespective also of any additional facts, whatever they may be, including for example that the Borrower was not able to obtain the funds from any other source, and the Lender was not willing to provide funding on any other terms, and the Borrower would not obtain any financial or other benefit from the accrual of the tax advantage to the Lender or the Share Recipient (the Borrower having no shareholding or other interest in the Lender or the Share Recipient), and there was a cash flow advantage to the Borrower in issuing shares instead of paying interest in cash.
|14 February 2012 Judge Berner||Cheshire County Federation of Women's Institutes, National Federation of Women's Institutes and others||LON/2007/1109 and Others||The common or related issues of fact and law are: 1. The Appellant in each case is a local Federation of Women's Institutes. Each is a registered charity. Each is a separate self -governing county and local Women's Institute federation of which some are VAT registered. The appeals are on identical points of law, namely whether subscriptions from membership fees are exempt from VAT. 2. The Appellants have a common aim or constitution and objects, which are, inter alia, to further the purposes of the Women's Institute organisation. 3. Membership of the Women's Institute is by subscription. 4. Subscription fees are the main source of income for each Appellant federation, as it receives an amount from each member's subscription fee, with the National Federation of Women's Institutes (the umbrella organisation) also receiving a fixed amount. 5. The Appellants seek exemption in respect of income from membership subscriptions under the VAT Act 1994 Schedule 9 Group 9 Item 1 on the basis that each one is "a body which has objects which are in the public domain and are of a political, religious, patriotic, philosophical, philanthropic or civic nature". 6. The Commissioners have rejected these submissions. Accordingly it is the treatment of the subscription element received by the Appellants that are the subject matter of the appeals. 7. In each case the tribunal will have to determine whether the activities of the Appellants are taxable supplies subject to VAT at the standard rate or can they be considered to fall within the exemption provided by Item 1(e) of Group 9. 8. The tribunal will have to consider the application of Item 1(e) of Group 9, and whether those activities are philanthropic or civic in nature? (It is submitted that none of the other objectives specified in Item 1(e) of Group 9 are applicable in these cases).
|4 April 2012 Judge Mosedale||Zipvit Ltd and Harrier LLC||TC 2010 6234 & 8393||The common or related issues of fact and law are:
Whether a taxable person, who has received supplies of services from Royal Mail which were at the material time treated by Royal Mail as exempt under the VATA 94, but which were properly chargeable to VAT under the sixth VAT Directive or the Principal VAT Directive is entitled to an input tax credit in respect of those supplies.
|26 March 2012 Judge Kempster||Taylor Ryan Ltd, Vaultdawn Ltd et al||TC 2009 16362, TC 2010 3064, TC 2011 0816 & 1712||The common or related issues of fact and law are: (a) Whether the amounts contributed by the appellant to the employee benefit trust and not paid as relevant emoluments by the trustees within 9 months of the end of the relevant period of account, are allowable deductions for the purposes of calculating the profits of the appellant chargeable to corporation tax; (b) Whether the appellant is liable to any primary and secondary Class I NICs in respect of payments its employees received from the employee benefit trust.|
|Judge Bishopp||Acornwood LLP, Bastionspark LLP, Edgedale LLP et al||SC/3082/2009, TC/2011/2075 and others|
|6 September 2012 Judge Kempster||Bupa Insurance Ltd et al||TC 2011 09264||The common issue of fact and law is: The relationship between BUPA Finance Plc (a link company under s 406(1)(a) ICTA 88 and CX Reinsurance Ltd for the overlapping period as defined by s403A(8) and whether for the purposes of s403C(2)(b) ICTA 88 BUPA Finance PLC was, in that period, "beneficially entitled" to a percentage of "any profits available for distribution to equity holders" of CX Reinsurance Ltd.|