Share premium account meaning

Alexander Beard v HMRC [2024] UKUT 73 (TCC) The taxpayer, Mr Beard, held shares in Glencore plc, a company incorporated in Jersey and domiciled in Switzerland. Between the tax years 2011–12 and 2015–16 he received cash distributions taken from the company’s share premium account, together with an in specie distribution in 2015 (the Distributions). HMRC issued a closure notice treating the Distributions as chargeable to income tax. Mr Beard appealed, contending that, because they were funded from the share premium account, the Distributions were dividends of a capital nature. This mattered because ITTOIA 2005, s 402 states that dividends from a non-UK resident company are subject to income tax, save for ‘dividends of a capital nature’. On that footing, Mr Beard maintained that the Distributions fell outside the income tax charge and were instead within the scope of capital gains tax...

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In this issue: Companies and corporation tax Employment taxes Taxes management and litigation VAT and indirect taxes Daily and weekly news alerts Updated content Dates for your diary Trackers Useful information Companies and corporation tax Court of Appeal finds that distributions debited to company's share premium account were dividends that were not capital in nature (Beard v HMRC) In Beard v HMRC [2025] EWCA Civ 385, the Court of Appeal upheld the FTT and UT’s conclusions that payments the taxpayer received from an overseas company, posted as debits to its share premium account, constituted dividends. They were not capital in character and were therefore subject to income tax. See: Court of Appeal finds that distributions debited to the company’s share premium account were dividends that were not capital in nature (Beard v HMRC). Employment taxes HMRC updates Check Employment Status for Tax (CEST) tool As noted in Tax update spring 2025,...