28 May 2015

FTT Decision: Cater Allen International Ltd & Abbey National Treasury Services Plc v HMRC

Corporation tax – loan relationship code – repo over interest coupons – legal and accounting concepts –interest coupons recognised in accounts during repo term – whether fair representation of profits – whether arising from loan relationship – DCC Holdings considered – need for symmetry – HELD – Accounting treatment is paramount – recognition is fair representation of profits – interest coupons arose from loan relationship – DCC Holdings approach to symmetry not relevant – appeal dismissed.

Kevin Prosser QC & Zizhen Yang, instructed by Slaughter and May, acted for the Appellants.

David Milne QC & David Yates, instructed by HMRC, for the Respondents.

Click here for the full decision.