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Commercial decision is avoidance

04 November 2014
Issue: 4476 / Categories: Tax cases , Avoidance

A Fisher, S Fisher, P Fisher (TC3921)

The taxpayer family ran a bookmaking business which moved to Gibraltar in 1999/2000 to take advantage of a more favourable betting duty regime than in the UK.

HMRC issued assessments charging income tax under the transfer of assets abroad anti-avoidance provisions in TA 1988 s 739 for the years 2000/01 to 2006/07 and under the provision in ITA 2007 s 720 for 2007/08.

The three taxpayers appealed insisting there was no avoidance. They moved the business to Gibraltar to compete with other bookmakers; the firm would otherwise have failed. Saving tax was not the reason for relocating.

The First-tier Tribunal said it was “inconceivable [that] the transfer would have gone ahead were it not for the betting duty being lower in Gibraltar” although the fact did not conflict with the decision to move being made for sound commercial reasons.

The taxpayers argued that the...

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