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This Practice Note outlines the law concerning criminal recklessness. The subjective test for recklessness Certain statutory and common law offences allow the prosecution to prove mens rea through ‘recklessness’. Put simply, recklessness is where the accused takes an unjustified risk that results in unlawful harm or damage. The House of Lords in R v G reaffirmed the subjective approach to recklessness. Before R v G, two distinct tests were used, depending on the offence charged: Subjective recklessness from R v Cunningham: the prosecution had to establish that the accused personally foresaw the risk. Objective recklessness from R v Caldwell: the prosecution only needed to show that the risk would have been obvious to a reasonable person, without proving the accused themselves foresaw it. In R v G, the House of Lords concluded that the objective test could operate unfairly where a defendant did not foresee the
This Practice Note examines the remedy of rescission, explaining when and in what manner a contract can be unwound (at common law, in equity and under statute) and thereby terminated and brought to an end. It covers the consequences and effects of rescission, the principal grounds for setting aside an agreement (misrepresentation, mistake, undue influence, duress, non‑disclosure, fiduciary misdealing and bribery) and the main obstacles to claiming rescission—affirmation, the intervention of third‑party rights and the impossibility of restitution. For further guidance on rescission in the context of misrepresentation, see Practice Note: Misrepresentation—rescission as a remedy. There are many ways in which a contract may reach its end; see: Terminating contracts—how and when a contract ends—overview for a brief and accessible summary, with links to the related further practical guidance, including Practice Note: Termination and expiry of contracts. For a table
What is a res judicata? A res judicata is a determination by a court or tribunal with jurisdiction over the cause of action and the parties, which finally disposes of the issues decided so they cannot be litigated again by those bound, save on appeal. Final judgments entered by default or by consent fall within this concept, whereas rulings on purely procedural points and any decision lacking finality do not. The doctrine’s aim is to bring litigation to an end and shield parties from being harassed by the same dispute twice. in personam—binds the parties and their privies in rem—binds all persons, privy or otherwise (ie a judgment binding the whole world) A party may rely on res judicata: as an estoppel to defeat an opponent’s claim or defence; and/or as the basis of their own claim or
The offence of causing grievous bodily harm with intent Wounding or causing grievous bodily harm (GBH) with intent can be tried solely in the Crown Court on indictment. Elements of the offence Under the Offences against the Person Act 1861 (OATPA 1861), the prosecution must establish that the defendant unlawfully and maliciously: wounded with the intention of causing GBH, or caused GBH with that intention, or wounded intending to resist or prevent the lawful arrest or detention of any person, or caused GBH intending to resist or prevent the lawful arrest or detention of any person ‘Unlawfully’ and ‘maliciously’ Unlawfully The wounding or causing of GBH must be unlawful. Such conduct may be lawful if used: in self-defence in defence of another in defence of property for the prevention of crime where the victim gave express or implied consent For further information on these defences, see below:
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The sale of a company's business can be structured as either: a disposal of the business assets held by the current owner, including goodwill (an asset sale); or a sale of shares where the business is operated through a company (a share sale) The decision between an asset sale and a share sale is driven by tax and non-tax factors. See Practice Note: Share sale or asset sale—tax considerations for a summary of the differing tax advantages and disadvantages associated with each route. This Practice Note sets out the principal tax points for the sale of assets by a corporate seller to a corporate buyer, where both are within the charge to UK corporation tax. Where a business is transferred, the asset purchase agreement typically includes specific contractual terms to ensure, so far as practicable, that the transaction is treated as a...
This Practice Note considers what is meant by company and by accounting period for the purposes of the controlled foreign company ( CFC) regime. The definition of company identifies which entities may constitute CFCs, while the definition of an accounting period fixes the timeframe in which a CFC charge may arise and against which other conditions are assessed. These are therefore key concepts to grasp. Meaning of company in the CFC context Apart from the position of cell companies, noted below, ‘company’ in the CFC sphere adopts the broad Corporation Tax Acts sense of any body corporate or unincorporated association (explored further in Practice Note: What is the basis of corporation tax?— Who is liable to pay corporation tax?). The expression ‘body corporate’ is not defined in UK tax legislation and bears its ordinary meaning......
ARCHIVED: This Practice Note is archived and is not maintained. It covers the former controlled foreign company ( CFC) regime, applying specifically to CFC accounting periods that began prior to 1 January 2013. For guidance on the equivalent topic under the current regime, see: CFC rules—interests and relevant interests, covering the same subject under the new rules. As set out in Old CFC rules—apportionment and tax charge, one must determine: which persons hold an interest in the CFC; and amongst that group, those with a relevant interest in the CFC This enables the apportionment of the CFC’s chargeable profits and creditable tax, and the calculation of any CFC tax charge payable. This note explores the notions of interest and relevant interests in a CFC in greater depth and detail. Who holds an interest in a CFC?......
ARCHIVED: This Practice Note is archived and is no longer maintained. It covers the former controlled foreign company ( CFC) rules that applied to accounting periods of CFCs beginning before 1 January 2013. For guidance on equivalent issues under the updated regime, see: CFC rules—calculating the CFC tax charge for details. Once it has been determined, in relation to a specific accounting period, that a company: is a controlled foreign company; and cannot rely on one of the exceptions it is then necessary to apportion: the chargeable profits, explained further in: Old CFC rules—chargeable profits; and the creditable tax, explained further in Old CFC rules—creditable tax among those persons who held an interest in the CFC at any point in that accounting period......
This Practice Note outlines whether, and to what extent, a person holds both an interest, and a relevant interest, in a controlled foreign company ( CFC). As further set out in Practice Note: CFC rules—calculating the CFC tax charge, it is necessary to identify and confirm: those persons who hold an interest in the CFC itself; and from among those with an interest, those who have a relevant interest in the CFC, to enable apportionment of the CFC’s chargeable profits and creditable tax and the calculation of any CFC tax charge due. Who holds an interest in a CFC?......
This Practice Note concerns the VAT domestic reverse charge ( DRC) for building and construction services, which took effect on 1 March 2021. Why does this matter? The reverse charge brings substantial accounting and verification consequences for building contractors and comparable trades, and may affect their clients. It impacts cashflow, and there is a danger of VAT being applied in error, leaving businesses open to assessments and penalties if they attempt to reclaim it as input tax. Carefulness is essential, and the status will need confirming before monies are released. Many issues are best tackled at the outset, within construction contracts. What is a reverse charge? A reverse charge is a method by which the customer, rather than the supplier, accounts for any VAT due. As a result, customers settle only the net value with their suppliers, and suppliers should not add VAT to their charges....
FORTHCOMING CHANGES : At Budget 2025, the government confirmed it will legislate via Finance Bill 2026 (also known as the Finance ( No 2) Bill 2024–26) to introduce fresh powers for HMRC to counter fraud by businesses operating within the CIS. Mirroring VAT provisions that limit input tax recovery where a supplier knew, or ought to have known, that a supply was connected to the fraudulent evasion of VAT, the new CIS rules will: allow the immediate removal of a business’s gross payment status make the business responsible for any lost tax permit a penalty of 30% of the lost tax to be charged to the business, its directors, and other connected persons where it can be shown that the business knew, or should have known, that it entered into a transaction linked to the fraudulent evasion of...
FORTHCOMING CHANGES : At Budget 2025, the government confirmed it will legislate via Finance Bill 2026 (also referred to as Finance ( No 2) Bill 2024–26) to introduce fresh powers for HMRC to combat fraud by businesses operating within the CIS. Reflecting VAT rules that curtail input tax recovery where the supplier knew, or should have known, that a supply was linked to the fraudulent evasion of VAT, the new CIS provisions will: permit the immediate removal of a business’s gross payment status make the business accountable for tax that has been lost authorise a penalty of 30% of the lost tax to be levied on the business, its directors, and other connected persons, where it can be demonstrated that the business knew or ought to have known it had entered into a transaction connected with the fraudulent evasion of tax In...
ARCHIVED: This Practice Note is archived and not being maintained. Brexit affects several elements of the PSC regime; for more detail, see Practice Note: PSC register—the people with significant control regime. The Small Business, Enterprise and Employment Act 2015 ( SBEEA 2015)—a summary Receiving Royal Assent on 26 March 2015, SBEEA 2015 is a far‑reaching Act covering a range of matters, including childcare, education, employment, access to finance, and company law. This Practice Note guides corporate lawyers through those parts of SBEEA 2015 that impact companies and amend the Companies Act 2006 ( CA 2006). The company law changes in SBEEA 2015 fall into two broad groups: measures intended to enhance transparency and trust in UK companies; and measures aimed at cutting red tape, including simplifying a number of company filing obligations. Towards the end of this Practice Note there are tables setting out the timing and...
Direct tax treatment of UK companies investing in UK land While purchasers may have grounds to hold commercial and, at times, residential property through an offshore structure, the UK limited company is still the predominant vehicle for investing in UK real estate. An important exception is privately used dwellings, for which a UK company is generally not a tax-efficient holder. This is a consequence of the April 2013 introduction of the annual tax on enveloped dwellings ( ATED) and associated measures, alongside the Single higher rate of SDLT for high-value residential transactions. ATED now extends to dwellings valued above £500,000, subject to a number of reliefs. For more information, see the Practice Notes: ATED—the basics and Single higher rate of SDLT for high-value residential property transactions. This Practice Note sets out the direct tax (that is, corporation tax) position of a...
The common law trust has long played a role across a range of commercial structures; yet its deployment is subtle and tailored to the circumstances of each arrangement. Although the equitable foundations of classic trusts remain pertinent, courts increasingly accept that the intricate rules devised for traditional trusts cannot simply be transplanted into commercial trusts. A trust possesses distinctive qualities that differentiate it from other legal relationships—such as contract, agency and bailment. This Practice Note highlights several established and potential applications of a trust that is deliberately constituted to achieve a commercial objective. Trusts arising by operation of law regardless of the parties’ intentions, or emerging from litigation, fall outside the scope of this Practice Note... What is a trust? See Practice Notes: An introduction to trusts for commercial lawyers and Nature and classification of trusts—the nature and...
This Practice Note considers the indirect tax issues which can arise on the development of land It explores indirect tax implications arising during land development. Many of these occur whether the site is for housing or other uses; however, residential projects attract certain tailored tax provisions. Direct tax matters for commercial property schemes are addressed in Practice Note: Development of commercial property—direct tax considerations, while the tax position for residential land is covered in Practice Notes: Development of residential property—direct tax considerations and Development of residential property—indirect tax issues. A comparison of the tax considerations for commercial and residential projects appears in Commercial development v residential development (tax issues)—checklist. The indirect tax points discussed here provide only an introductory overview of those likely to arise on a typical project. Every scheme has its own nuances, from straightforward housing conversions to major shopping centre builds. Further detail on these...
What is the climate change agreement scheme? The CCA scheme enables eligible facilities to benefit from a reduced rate on the Climate Change Levy ( CCL). Refer to Practice Note: Climate change levy. CCAs are voluntary arrangements under which an eligible energy‑intensive facility can obtain up to a 90% cut in CCL, and a 100% reduction for energy used in specified energy‑intensive (metallurgical and mineralogical) industrial processes, provided it signs up to energy efficiency targets agreed with government. “ CCA” is defined in Schedule 6, paragraphs 46–48 of the Finance Act 2000 ( FA 2000). The scheme operates through a two‑tiered structure: Umbrella agreements — the Department for Energy Security and Net Zero ( DESNZ) and industry sectors negotiate umbrella terms. The agreement is then held between the sector or trade association and the administrator, and sets out sector commitments, obligations and...
FORTHCOMING CHANGES : At Budget 2025, the government stated it will legislate through Finance Bill 2026 (also referred to as Finance ( No 2) Bill 2024–26) to introduce powers for HMRC to combat fraud by businesses operating within the CIS. Reflecting VAT provisions that restrict input tax recovery where a supplier knew, or ought to have known, that a supply was linked to fraudulent VAT evasion, the new CIS rules will include the following: enable the immediate removal of a business’s gross payment status make a business responsible for tax that has been lost permit a penalty of 30% of the lost tax to be levied on the business, its directors, and other connected persons where it can be shown that the business knew, or should have known, that it entered into a transaction connected with the fraudulent evasion of...
FORTHCOMING CHANGES : At Budget 2025, the government confirmed that it will legislate in Finance Bill 2026 (also known as Finance ( No 2) Bill 2024–26) to introduce new HMRC powers to combat fraud perpetrated by businesses operating within the CIS. Mirroring VAT rules that restrict input tax recovery where a supplier knew, or should have known, that a supply was connected to the fraudulent evasion of VAT, the forthcoming CIS provisions will: provide for the immediate cancellation of a business’s gross payment status make a business liable for tax that has been lost, and permit a penalty of 30% of the lost tax to be imposed on the business, its directors and other connected persons, where it can be demonstrated that the business knew or ought to have known that it had entered into a transaction linked to the...
This Practice Note explains the two chargeable gains tax reliefs relevant to dealings under a scheme of reconstruction. For a definition of ‘scheme of reconstruction’, refer to the Practice Note: Schemes of reconstruction defined......
Value shifting rules Value shifting rules are anti-avoidance measures. They resemble the regime for depreciatory transactions in that they address contrived movements of value out of assets arising from dealings between connected parties. Yet they have a broader reach in practice. They are engaged across a wider spectrum of situations. Compared with the depreciatory transaction rules, they: may bite even without a genuine disposal; a charge to tax arises at the point of the value‑shifting step because the asset is treated as disposed of; can turn losses into gains and augment gains recognised on a disposal (actual or deemed); and operate by reference to the asset itself, so there is no requirement to demonstrate any significant fall in the value of the asset‑holding company's shares for the rule to engage and apply. The two sets of rules should nonetheless be...
FORTHCOMING CHANGE relating to the reform of offshore anti-avoidance legislation: On 21 July 2025, HMRC released a summary of responses to its call for evidence on personal tax offshore anti-avoidance legislation, following a consultation that ran from 30 October 2024 to 19 February 2025. The call for evidence sought high-level input across a number of legislative areas, including the rules attributing gains to participators in non- UK companies. In publishing the outcome, the government notes it will consider how best to engage further with relevant experts to shape and advance additional consultation across this area as a whole, with an update to be provided at the Autumn Budget 2025. Any legislative changes arising from this consultation are not expected to apply before the 2027–28 tax year, at the earliest. For further details, see News Analysis: Legislation Day: Draft Finance Bill 2026— Private Client...
This Practice Note: sets out the principal CGT (used here as shorthand for capital gains tax and corporation tax on chargeable gains) consequences of a rights issue for shareholders who: are resident in the UK for tax purposes; and hold their existing shares in the issuer as an investment (also called original shares) and are therefore within the charge to tax on gains on any disposal of their shares in the issuer, whether those shares are existing or newly issued; does not consider the tax position of shareholders who either: are resident for tax purposes outside the UK; or are subject to special tax rules because, for...
FORTHCOMING CHANGE relating to call for evidence on tax support for entrepreneurs: At Budget 2025, the government launched a formal public call for evidence (closing date: 28 February 2026) on how existing tax incentive arrangements operate and on potential measures to extend support for entrepreneurs. The exercise concentrates in part on the venture capital schemes and on enterprise management incentives. It also references investors’ relief and, more specifically, invites views on how the tax regime might better enable reinvestment by successful entrepreneurs, including the function and effectiveness of business asset disposal relief. Investors’ relief is a capital gains tax ( CGT) relief intended for individuals who invest in unquoted trading companies while not taking part in the management or operation of the business. Such investors will not generally qualify for business asset disposal relief ( BADR, formerly...
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When evaluating a general damages claim, the practitioner ought initially to refer to the Judicial College Guidelines (JCG)...
This Practice Note This Practice Note reviews mechanisms used in settling litigation. A Tomlin order consists of a consent order paired with a schedule. It operates to stay proceedings on terms that have been agreed. The provisions contained in the schedule may remain confidential. This Practice Note describes the scope of confidentiality attaching to the schedule and sets out how it differs from a standard consent order. Sample wording for a Tomlin order is included, alongside links to precedents, as well as guidance on court approval. It also addresses varying, setting aside and enforcing a Tomlin order, including the considerations the court will take into account when handling applications for each. Further guidance is provided on interpreting and applying the relevant provisions of the CPR; however, some courts and divisions impose very specific requirements for both drafting and approval, and for approaching the schedule and confidentiality issues. Accordingly, you must consider the particular rules and court guide provisions in the forum where your claim is proceeding when drawing up the Tomlin order...
Date [ date ] Parties [ name of Landlord ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Landlord) [ name of Tenant ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Tenant) [ [ name of Guarantor ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Guarantor) ] [ [ name of Mortgagee ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Mortgagee) ] Definitions Within this Deed, the terms below shall be interpreted as follows: [ Annual Rent • the annual sum reserved under the Lease; ] [ Insurance Rent • the Tenant’s share of the Landlord’s costs of insuring the Property (as set out in the Lease); ] Lease • the lease of the Property dated [ date ], entered into between (1) [ the Landlord OR [ name ...
I, [ name ], of [ address ], solemnly and sincerely state that: [ Matters to be verified, set out in numbered paragraphs ] I make this solemn statement in good conscience, believing it to be true, and pursuant to the provisions of the Statutory Declarations Act 1835. DECLARED at [ details ] this [ day ] day of [ month and year ] Before me ................................................................................ [ signature of the person before whom the declaration is made ] A [ commissioner for oaths OR [ solicitor OR [ insert other qualification ] ] authorised to administer oaths ]...
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