This case considers a technical point within the consortium relief legislation.
A recent First-tier Tribunal (FTT) case considered the operation of CTA 2010, s 146B which limits the amount of consortium relief where certain arrangements exist – specifically, arrangements which enable a person to prevent the surrendering company or a link company from controlling the claimant company where the purpose, or one of the main purposes, of the arrangements is to enable the claimant company to obtain a tax advantage from consortium relief.
The FTT concluded that CTA 2010, s 146B does not apply to an arrangement where there is no pre-existing control. This enabled it to decide that questions relating to purpose which HMRC were seeking to answer were not relevant and HMRC therefore had no reason not to issue a closure notice.
The FTT declined to answer two other technical issues on the same legislation on the basis that they were questions of law on the construction of a document and could be decided (on an appeal in due course if necessary) without any further factual information.
The decision also contained some minor administrative points of interest. The FTT rejected HMRC’s contentions that:
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