The Upper Tribunal has rejected an appeal by the taxpayers, in a scheme whereby certain amounts were reallocated to individual LLP members via a corporate member – HFFX LLP, Christopher Shucksmith and others v HMRC  UKUT 73 (TCC).
The decision in this complex case was long. However, the taxpayer appellants failed to convince the UT that “FTT went wrong as a matter of principle, or that it reached a decision that was plainly wrong”.
The FTT had been entitled to accept HMRC’s argument that the income from the corporate member was taxable as miscellaneous income under ITA 2007, s. 687.
The UT concluded that a discovery assessment had indeed been made, even though the FTT did not make an explicit finding on the point.
An appeal against the FTT refusal for redaction of the case was dismissed.
A cross-appeal by HMRC was also rejected.
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In Tax Appeals – Law and Practice at the FTT, tax barrister Keith Gordon analyses some 500 precedents to show how the FTT rules are applied in practice, and how taxpayers may use the tribunal system for appealing against tax decisions.