Clawback meaning

Christopher Purkiss (as liquidator of Ethos Solutions Limited) v Tim Kennedy and others [2025] EWCA Civ 268 Ethos Solutions Limited (the Company) ran a disguised remuneration arrangement under which sums were channelled to an employee benefit trust (EBT) without withholding income tax or NICs. The EBT’s trustee allocated funds into sub-trusts for the respondents and, when asked, advanced the amounts to them as discretionary loans. On 4 December 2012, HMRC issued determinations, holding the Company liable for income tax and NICs of c.£2m arising from payments made to the EBT in the 2008‑09 and 2009‑10 tax years. On 18 December 2012, the Company entered creditors’ voluntary liquidation, making no remittances to HMRC and taking no steps to appeal. On 9 January 2013, HMRC lodged a proof of debt totalling c.£2m with respect to those same EBT payments, as claimed therein...

With what it considers measured, targeted updates to the 2018 UKCG Code, the FRC aims to strike a balance: sustaining investor and stakeholder confidence in premium listed companies while keeping administrative and regulatory demands on businesses to the minimum required. Digital guidance linked to the 2024 UKCG Code is due for publication on 29 January 2024. Original news: FRC publishes revised UK Corporate Governance Code, LNB News 22/01/2024 18. The Financial Reporting Council has now issued its revisions to the UK Corporate Governance Code (the Code), intended to bolster transparency and accountability across UK companies and to underpin the UK’s growth and competitiveness... Why is the UKCG Code changing? On 24 May 2023, the FRC opened a consultation setting out 18 proposals to amend the 2018 Code, centred chiefly on building a stronger framework for prudent, effective risk management and internal controls. They also acknowledged the broader duties of boards and audit committees regarding expanded environmental, social and governance reporting, audit and assurance requirements, and identified opportunities to...

In this issue: Corporate governance Retained EU law Q&As Useful Information Weekly highlights from other practice areas Corporate governance FRC revises UK Corporate Governance Code The Financial Reporting Council (FRC) has published an updated UK Corporate Governance Code (UKCG Code) (the 2024 UKCG Code), introducing only modest amendments to the 2018 iteration (the 2018 UKCG Code). This update follows the FRC’s consultation issued on 24 May 2023, which backed the legislative changes set out in the government’s response to its May 2022 White Paper, Restoring Trust in Audit and Corporate Governance (for further details, see: Share Incentives weekly highlights—25 May 2023—Corporate governance). The consultation presented 18 proposals to revise the 2018 UKCG Code, with an emphasis on establishing a stronger framework for prudent, effective risk management and internal controls. However, on 7 November 2023 the FRC stated that it would not proceed with most of its suggested revisions to the 2018 UKCG Code, so as to lessen the...

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...

Companies subject to corporation tax may set qualifying charitable donations (QCDs) against total profits once all other reliefs have been claimed, except group relief and group relief for carried‑forward losses, allowing profits to be reduced to nil. Any surplus QCDs lapse unless the company has an investment business. Investment businesses may deduct management expenses from total profits, and this deduction must be taken before any other deductions from total profits. Unused management expenses can be carried forward to the next accounting period and set against that period’s total profits or, for losses arising on or after 1 April 2017, surrendered for group relief. Where there are excess QCDs, they can be carried forward as management expenses, but cannot be surrendered for group relief for carried‑forward losses. For accounting periods beginning on or after 1 April 2024, donations to non‑UK charities do not attract relief. Relief for qualifying charitable donations When a company makes a QCD in an accounting period, it...

Tax is a key consideration when selecting an appropriate structure for holding UK commercial property. The prevailing route for investing in UK commercial property is typically a UK‑incorporated, tax‑resident limited company. Non‑UK investors have also gravitated towards offshore ownership for investment, commonly via a non‑UK resident special purpose vehicle (SPV). Following reforms to the taxation of gains realised by non‑UK residents on UK immovable property from 6 April 2019, and to the taxation of property income of non‑UK resident companies from 6 April 2020, non‑UK resident companies that hold UK commercial assets now fall within UK corporation tax on gains (subject to certain exemptions) and on rental income. As a consequence, a number of the core tax attractions of using non‑UK resident SPVs to own UK commercial property have been curtailed. Nevertheless, acquiring UK commercial property through an offshore SPV remains a widely used and popular structure for many investors. It can still continue to provide a saving in stamp duty land tax when compared with purchasing the underlying...

1 Should the [ Board OR Remuneration Committee ], at any point in time within [ three ] years from the date a bonus has been paid to you, in its sole and absolute discretion conclude that any event set out in sub-clauses 1.1 to 1.4 of this clause has arisen, it may demand that you repay some or all of the pertinent bonus payment (irrespective of whether you remain in employment with the Company or any other Group Company), with such repayment to be carried out strictly in line with clause 2: 1.1 [ the Company or any other Group Company being required to materially restate all or part of its financial statements OR your gross negligence, fraud, dishonesty or other misconduct having caused or helped to cause the Company or any other Group Company to materially restate all or part of its financial statements ] ; 1.2 your gross negligence, fraud, dishonesty or other misconduct, or your commission of any further act or...

[ To be issued on the landlord’s headed paper ] Your Ref: Our Ref: Date: From: [ name of Landlord ] [ of OR a company incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (‘Landlord’, ‘we’, ‘us’) To: [ name of Tenant ] [ of OR a company incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (‘Tenant’, ‘you’, ‘your’) [ CC: [ name of Guarantor ] [ of OR a company incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Guarantor) ] Dear Sirs, Re: Request for reduced rent payments under your lease dated [ date ] of [ description ] (Property) made between (1) [ name of original landlord ] [ , OR and ] (2) [ name of original tenant ][ and [ name of any original...

This declaration of trust is entered into on [ insert date on which this declaration of trust is executed ] by [ insert name of nominee ] of [ insert address of nominee ] [ , a company registered in England and Wales (registered number [ insert company number ]) ] (the Nominee). BACKGROUND (A) On [ insert date on which LTIP Contingent / Matched Award / Option was granted ] (the Date of Grant), [ insert name of Participant ] (the Participant) received a [ Contingent Award OR Matched Award OR Option ] (the Award) over [ insert number and class of shares under award or option ] in the capital of [ insert name of company whose shares are subject to LTIP awards ] (the Company) pursuant to the terms of the [ insert name of LTIP ] (the Plan)...

HSC(CHS)A 2003, Part 3 For personal injury compensation claims where the incident occurred on or after 29 January 2007, Part 3 of the Health and Social Care (Community Health and Standards) Act 2003 (HSC(CHS)A 2003) applies. The HSC(CHS)A 2003 extends to any matter involving foreign nationals and foreign compensators, in circumstances where NHS treatment and/or ambulance services were delivered to the injured person following their return to England, Scotland or Wales. Part 3 of the HSC(CHS)A 2003 permits recovery of the costs of treating an injured person in all situations where that individual has successfully pursued a personal injury claim against a third party. Under HSC(CHS)A 2003, s 150(3), a ‘compensation payment’ is a payment, including one in money’s worth, made on behalf of a person who is, or is alleged to be, liable in respect of the injury. HSC(CHS)A 2003, s 150(3) further provides that relevant NHS charges are not included...

LPA’s obligations when imposing financial contributions Developers are frequently obliged to make monetary payments to the local planning authority (LPA) to fund defined projects, helping to offset the harmful effects of a scheme and thereby enable the grant of planning permission. This Q&A addresses circumstances where the section 106 agreement contains no specific express clawback mechanism. When a planning obligation (a section 106 obligation) is proposed to secure a financial contribution at the determination stage of a planning application, that contribution must satisfy the stringent legal tests in regulation 122 of the Community Infrastructure Levy Regulations 2010, SI 2010/948 (SI 2010/948, reg 122) (as amended). Only by meeting those tests can any such payment lawfully and ultimately underpin the grant of planning permission...