10 October 2024
Redevco Properties Uk1 Limited & Trustees of the Panico Panayi Accumulation and Maintenance Settlements v HMRC [2024] UKUT 00319 (TCC)
These joined appeals concern the compatibility of the UK legislation on company and trustee migrations (in particular, ss 80 and 185 TCGA 1992 and paragraph 10A schedule FA 1996) with EU law and whether the UK legislation requiring immediate payment of corporation tax (ss 59B and 59D TMA 1970) can be subject to a conforming construction to permit deferred payment of the charges (as required by the relevant CJEU jurisprudence) or should alternatively be disapplied.
Dismissing the taxpayers’ appeals, the Upper Tribunal has held that the legislation can be subject to a conforming construction such that, where a taxpayer’s right of freedom of establishment would otherwise be infringed, it includes an option to defer payment of the exit tax in five equal annual instalments.
Ben Elliott acted for HMRC. You can view the judgment here.
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