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J White v CRC, Upper Tribunal (Tax and Chancery Chamber), 7 August 2018
The taxpayer ran a skip hire business as a sole trader. He claimed relief for bad debts owed by his father’s company, MWL. HMRC refused on the grounds that the loans were capital investments and the write-off was not wholly and exclusively for the purpose of the trade. The First-tier Tribunal dismissed the taxpayer’s appeal.
The Upper Tribunal said the First-tier Tribunal had been entitled to conclude that the taxpayer had failed to establish the existence and amount of the loans. The fact that he had made the loans to ensure the company could provide him with essential business facilities was not relevant.
The taxpayer’s appeal was dismissed.
