Chargeable amount meaning

In this issue: Trusts Court of Protection UK taxes for Private Client HMRC Manuals updates Insolvency—Private Client Charity and philanthropy Contentious trusts and estates Scotland, Wales and Northern Ireland International Question of the week Daily and weekly news alerts LexTalk®Private Client: a Lexis®PSL community New and updated content Dates for your diary Trackers Latest Q&A Useful information Trusts Companies House publishes guidance on removal of overseas entities from register Companies House has issued guidance setting out the process for taking an overseas entity off the Register of Overseas Entities. It applies where the entity no longer holds registered title to UK land or property acquired on or after 1 January 1999 in England and Wales, 8 December 2014 in Scotland, and 5 September 2022 in Northern Ireland. The guidance confirms the entity must have disposed of all UK property or land, and the transfer of ownership...

UK Care No 1 Ltd v HMRC [2024] UKFTT 542 (TC) The FTT examined the operation of the ‘imported losses’ restriction contained in CTA 2009, s 327. Under that code, relief for a loss arising on a loan relationship is denied to the extent the loss is properly referable to a period during which the company attempting to bring it into account would not have been chargeable to corporation tax on any profits from that same loan relationship. The appellant, which was tax resident in Guernsey, had issued certain loan notes that were secured over the BUPA group’s UK care home undertaking. In 2016, BUPA sought to sell a number of care homes that constituted part of the security package supporting the notes. To enable those transactions to proceed, BUPA acquired the appellant, with the result that the appellant became UK tax resident, following which the notes were redeemed by the appellant itself. The loan notes incorporated a ‘Spens’ (or ‘make whole’) provision; broadly, this meant that on an...

Beard v Revenue and Customs Commissioners [2024] UKUT 73 (TCC) What are the practical implications of this case? On 22 March 2024, the Upper Tribunal (Mr Justice Roth and Judge Jennifer Dean) determined that the First-tier Tax Tribunal (Judge Rachel Short) had rightly concluded that approximately £150m of distributions paid over a continuous five-year period to Mr Alexander Beard, a UK resident, by Glencore plc—a company incorporated in Jersey and domiciled in Switzerland—were chargeable to income tax in his hands for UK tax purposes, and did not amount to ‘dividends of a capital nature’ within section 402(4) of the Income Tax (Trading and Other Income) Act 2005 (ITTOIA 2005). As a result, the particular planning implemented by Mr Beard, which aimed for the payments to be treated under the capital gains tax regime, did not, subject to any further appeal, achieve the desired outcome. This ruling will interest those advising UK resident clients with substantial shareholdings in non-UK resident companies. It provides a useful analysis of...

The way consideration payable for buying shares is arranged is rarely simple or linear, and can vary considerably. In many situations payment is postponed, deferred, or made conditional on a particular contingency being satisfied. Selling shareholders will look to maximise the overall price for their shares while also seeking to limit, so far as possible, any tax on disposal by: making full and efficient use of available reliefs to cut or remove any charge, and/or delaying the point in time at which any such tax becomes due However, where the consideration is deferred, the seller can become liable to tax immediately on an amount not yet received (a ‘dry’ tax charge). In calculating chargeable gains, no discount is usually allowed in respect of any consideration that is ascertainable at the date of disposal, even where it is: deferred subject to a contingency, or at risk of not being received for any reason Where any deferred...

Ordinarily, distributions take the form of cash dividends paid by a company to its shareholders—essentially a straightforward payment of profits to the company’s owners. However, the corporation tax meaning of distribution differs from the company law concept (see Practice Note: Dividends, distributions and scrip dividends). Why does it matter whether a payment is a distribution? It is vital to establish whether a particular payment by a UK company is a distribution because, if it is: the paying company is not permitted a deduction for the amount in its UK corporation tax computation; and a UK corporate recipient will be chargeable to corporation tax on the amount under CTA 2009, Part 9A, unless the payment falls within one of the specific exemptions—for further detail, see Practice Notes: How are small companies taxed on distributions received? and How are non-small companies taxed on distributions received? Since most routine distributions are covered by an exemption from tax, it will usually be in the recipient’s...

ARCHIVED This archived Practice note reviews the clawback of business investment relief (BIR), the remittance relief for investment into UK companies. It covers: extraction of value how to avoid a chargeable remittance after a potentially chargeable event the order in which disposals are treated the interaction with the mixed funds rules the capital gains tax (CGT) position STOP PRESS: Abolition of non-dom regime and introduction of residence-based IHT regime The Finance Act 2025 (FA 2025), which received Royal Assent on 20 March 2025, legislates to abolish the remittance basis of taxation and introduce a residence-based regime from 6 April 2025. FA 2025 also replaces domicile as the key criterion for inheritance tax liability. Additional changes include amendments to the excluded property rules, removal of protected settlements status for offshore trusts, and revisions to overseas workday relief. For details on these reforms, see Practice Notes: The abolition of the remittance basis of taxation from 2025–26 and A new residence-based...

1 Budget particulars Applies to: [ Insert eg, Whole firm, Conveyancing department, Charity sector etc ] Budget holder: [ Insert name and role ] Authorised by: [ Insert name and role ] Financial year: [ Insert year the budget applies to ] 2 Summary overview 2.1 The combined business development and marketing allocation for [ insert eg, the firm, the conveyancing department etc ] stands at: £[ insert amount ]...

1 Pro bono vision 1.1 We accept our duties to clients, colleagues, suppliers and other stakeholders, alongside the broader community in which we work. Through our policies and day-to-day practices, we seek to uphold exemplary governance and client service, and to foster a constructive workplace that enables our people to grow while actively supporting our local community... 1.2 We recognise that many in our society face barriers to the justice system when seeking to resolve legal issues. As lawyers, we are uniquely placed to assist. Providing pro bono advice and representation to those in need is a core element of our commitment to the community... 1.3 We will endeavour to contribute [insert the amount of support the organisation will aim to provide for pro bono work, such as a defined number of hours per lawyer, the monetary value of otherwise chargeable time, or a percentage of annual billings] to deliver pro bono support to individuals and community organisations who struggle to obtain legal services...

This Deed is made on [ insert date on which this deed is executed by all parties ] Parties [ Insert name of Company ], with its registered office at [ insert address of registered office ] and registered number [ insert registered number of Company ] (the Company); and [ Insert name of Trustee ], whose registered office is at [ insert address of registered office ] [ and registered number [ insert registered number of Trustee ] ] (the Original Trustee). RECITALS The Company intends to create a trust for the benefit of the employees of the Company, to be called the [ insert name ] Employee–Ownership Trust, and designed to meet the requirements of section 236J of the Taxation of Chargeable Gains Act 1992. The Company has transferred to the Original Trustee the sum of £[ insert initial settlement amount ] as the initial Trust Fund...

When is grossing up required? For guidance on when grossing-up is needed, see Practice Note: Grossing up and partly exempt estates, particularly the section entitled 'When is grossing up required?'. Note that on death, if the residuary estate passes wholly to non-exempt beneficiaries, grossing up does not arise, whether or not any specific legacy is tax-free or chargeable. Where a specific legacy is tax-free, the nominated sum or item is delivered as given and the relevant IHT is paid from the estate in the usual manner; the residuary estate is then calculated. If grossing up applies and the combined amount of all specific gifts (both chargeable and exempt) exceeds the value transferred, i.e. the free estate for IHT, section 37(2) of the Inheritance Tax Act 1984 operates to reduce specific gifts so far as required to bring them down to the value transferred. See: IHTM12086, IHTM12088 and IHTM26180 (which sets out computations where abatement is triggered by grossing up). Further reading: Practice Note:...

The working assumption is that the land concerned is residential freehold property in England or Wales, and that no tax avoidance is in point. SDLT treatment of the first 40% transaction As set out in Practice Note: Land transactions, chargeable interests and chargeable transactions, a land transaction with no chargeable consideration (for which see Practice Note: SDLT chargeable consideration) is outside the scope of SDLT, an exempt transaction...

As the individual was not domiciled in any part of the UK on death, only assets located in the UK may fall within the scope of inheritance tax (IHT). Assets situated outside the UK are treated as excluded property under section 6 of the Inheritance Tax Act 1984 (IHTA 1984) and, accordingly, do not comprise the deceased's estate as defined by IHTA 1984, s 5 ...