HMRC wins £500 million judgment in Supreme Court
In an important ruling that will save the UK around £60 million, rising to £500 million for similar cases, the Supreme Court has ruled unanimously that HMRC is entitled to enforce payment of a tax debt and withhold tax relief arising from an avoidance scheme while enquiring into the scheme.
HM Revenue and Customs opened an enquiry into the claim to tax relief for losses from a later year. The taxpayer contested HMRC’s right to refuse any tax relief during the enquiry, but the Supreme Court upheld HMRC’s appeal.
HMRC welcomes the Supreme Court decision as a significant deterrent against the “cash flow” advantages which could otherwise be open to users of personal tax avoidance schemes.
Around 200 users of this particular scheme may be affected by the Supreme Court’s decision.