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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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STOP PRESS/ FORTHCOMING CHANGES : The UK intends to transpose the OECD’s Cryptoasset Reporting Framework ( CARF) into domestic law from 1 January 2026. The enabling instrument is the Reporting Cryptoasset Service Providers ( Due Diligence and Reporting Requirements) Regulations 2025 ( SI 2025/744), which was presented to the House of Commons on 25 June 2025. On that date, HMRC released tax impact and information notes ( TIIN) on the measure. HMRC has also issued guidance covering reporting under CARF. In parallel, the government has brought forward legislation revising the domestic rules that give effect to the OECD’s Common Reporting Standard ( CRS) and the UK’s obligations under the Intergovernmental Agreement with the US for the implementation of the US Foreign Account Tax Compliance Act ( FATCA). The core legislation remains the International Tax Compliance Regulations 2015 ( SI 2015/878), with...
What reliefs and exemptions are available? The core charge to the annual tax on enveloped dwellings ( ATED) is set out in Practice Note: ATED—the basics. A selection of ATED reliefs and exemptions is available; these are highlighted below and explored in greater detail in this Practice Note. The reliefs most frequently encountered in practice cover: property rental businesses property developers property traders financial institutions acquiring dwellings in the course of lending Additional ATED reliefs arise in defined situations and are likewise summarised below. There is also an interim relief intended to ease taxpayers’ cash flow. Interim relief operates as a process for claiming ATED reliefs, rather than constituting a relief from ATED in its own right......
FORTHCOMING CHANGE relating to new advance clearance processes: Following an initial announcement at Autumn Budget 2024 under the government’s Corporate Tax Roadmap, and a consultation released alongside Spring Statement 2025, Budget 2025 set out the consultation outcome and confirmed HMRC will introduce an advance tax certainty service in July 2026. The regime is intended for qualifying persons backing ‘major projects’ with at least £1bn of eligible UK spend. As trailed at Budget 2025, the service will address a defined suite of taxes—corporation tax, VAT and stamp taxes—while excluding transfer pricing, valuation, purpose‑based tests and hypothetical cases. Clearances will commit HMRC (but not the taxpayer) not to revise its view of the law, on the basis of fully disclosed facts, for up to five years, provided facts and law remain unchanged, with pragmatic renewal available. Initially, no fees will be charged and...
Why is the exemption for financial services important? VAT is a significant concern for firms in the financial sector, as supplying certain categories of financial services to customers belonging in the UK is exempt from UK VAT. This matters because: businesses will not levy VAT on services within the exemption; and such businesses cannot recover input VAT on supplies they receive while making an onward exempt supply The intermediary exemption for financial services Financial services supplies often involve other businesses serving as intermediaries between the parties requesting and delivering the services. Further parties may participate in a financial services transaction, for example by offering specialist advice or helping to ensure the deal proceeds. These services are VAT-exempt where the supplier: operates in an intermediary capacity provides intermediary services in relation to certain specified financial services transactions (whether or not the...
This Practice Note sets out: the function of the tax indemnity provision commonly included in a loan agreement, and that the usual drafting of this provision is lender‑friendly, reducing the borrower’s benefit, and offers drafting suggestions to help a borrower limit its exposure under the tax indemnity provision In the sphere of syndicated loans to corporate borrowers, standard practice is to use one of the Loan Market Association ( LMA) model facility agreements. Each of these templates: includes a standard tax indemnity provision, is prepared in a lender‑friendly manner, and assumes the relevant tax is UK withholding tax—identifying the applicable withholding tax jurisdiction is essential and, if it is not the UK, the agreement should be amended...
Practice Note This Practice Note outlines relief where a company sustains a loss in its UK property business or in its overseas property business. Each is regarded as a distinct undertaking, so UK and overseas property activities are kept separate, with losses computed and relief claimed independently for each category......
Practice Note This Practice Note outlines how capital gains tax and corporation tax on chargeable gains apply to UK general partnerships, limited liability partnerships ( LLPs) and limited partnerships. For the purposes of this note, ‘partner’ should be taken to include an LLP member, and ‘ CGT’ is used as a collective term for both capital gains tax and corporation tax on chargeable gains. Partnerships are fiscally transparent: they are not chargeable persons in their own capacity. Instead, the partners are assessed directly on the partnership’s profits and gains. For CGT, the partnership’s capital assets are treated as held by the partners in proportionate fractions. A partner’s interest in the firm is not regarded as a distinct capital asset. Dealings undertaken by the partnership are therefore treated as dealings by the partners rather than by the firm itself. In relation to an LLP, there are...
Safeguards are in place to prevent, in broad terms, the movement of assets between connected parties in a manner that speeds up capital allowances via the annual investment allowance or first-year allowances, or that deliberately contrives to overstate the figure on which relief is available by any artificial means whatsoever. This Practice Note explains how the capital allowances regime defines connected persons and also sets out how those provisions operate when assets pass between such persons. For further guidance and detail on an election permitting alternative treatment where a trade is transferred between connected persons, see Practice Note: Capital allowances and company reconstructions— Transfer of a trade between connected persons in practice. For an overview of the computation of capital allowances for plant and machinery, including, in particular, the meanings of annual investment allowance, first-year allowances, disposal value and writing down allowance, refer to Practice Notes: How plant and...
This Practice Note outlines how the bank levy currently operates and the re-scoping introduced in 2021. It has been prepared in collaboration with Charlotte Sallabank and Larry Wong of Katten Muchin Rosenman. The bank levy is a tax that: applies to periods of account—termed chargeable periods in the legislation—that end on or after 1 January 2011; and is levied on specified categories of equity and liabilities—referred to as chargeable equity and liabilities—measured at the end of a chargeable period for banks, building societies, and groups that include them It is a balance sheet tax rather than a tax on bank profits, and the first £20bn of chargeable equity and liabilities falls outside the scope of the bank levy. Structure of this Practice Note The bank levy rules depend on a wide range of detailed definitions. To assist readers, selected key terms are listed at the end of...
Why are the SDLT anti-avoidance provisions important? The stamp duty land tax ( SDLT) anti-avoidance regime contained in section 75A of the Finance Act 2003 ( FA 2003) first appeared in the Pre- Budget Report 2006 and was later put on a statutory footing as primary legislation by the Finance Act 2007 in an expanded form, being FA 2003, ss 75A–75C (referred to collectively in this Practice Note as 's 75A'). The measures were brought in to deter the apparently substantial volume of SDLT planning arrangements deployed across both commercial and residential land transactions in the United Kingdom. They have effect for disposals occurring on or after 6 December 2006, subject to transitional provisions. Instead of closing SDLT planning arrangements one structure at a time through amendments to particular parts of the SDLT code, the chosen policy was to adopt a 'mini general...
Direct tax treatment of leases—other transactions For the direct tax analysis of landlords and tenants on the grant of leases, see Practice Note: Direct tax treatment of leases—grant of a lease. This Practice Note addresses the direct tax position of landlords and tenants for other dealings concerning leases, chiefly assignments, surrenders and variations of existing leases. The VAT and stamp duty land tax ( SDLT) consequences of these transactions are also crucial in determining the parties’ overall tax position; see the following Practice Notes: VAT issues for new and ongoing leases VAT issues for lease assignments and terminations SDLT chargeable consideration—leases SDLT—common lease transactions Consistent with the approach to lease grants, the tax treatment of transactions affecting existing leases depends on a range of factors, including the parties’ tax status, the term of the lease and the purpose for which the transaction is undertaken. The legal mechanics of...
This Practice Note sets out the distinct stamp duty land tax ( SDLT) provisions that arise where a stake in land is moved into a partnership by one or more partners, or by individuals connected to them. It also covers transfers made when the partnership is first established. SDLT no longer applies to any land transaction concerning interests in or over land situated in Scotland from 1 April 2015. From that date, land and buildings transaction tax ( LBTT) governs those transactions, subject to transitional rules. For more information, refer to the LBTT subtopic. Likewise, SDLT stopped applying to any land transaction involving interests in or over land in Wales from 1 April 2018. From that date, land transaction tax ( LTT) applies to those transactions, again subject to transitional provisions. For additional detail, see the Wales: LTT subtopic......
Practice Note This Practice Note considers situations where a person has overpaid tax (that is, paid tax that was not in fact due) and their ability to recover that sum under the common law of restitution. It applies to both direct taxes and VAT and addresses the taxpayer’s rights to reclaim such amounts... Direct taxes VAT Overpayments arise for a range of reasons, though a significant number of court cases have concerned tax charged in breach of EU law. A taxpayer should first determine whether they have, or previously had, a statutory route to recover overpaid tax, see Practice Note: Overpaid tax—the statutory regimes. If a statutory right exists, the terms of that legislation may bar a common law restitution claim, even where the statutory claim is now out of time... This Practice Note cites EU-derived law and case...
Corporation tax deduction for costs incurred in setting up and operating employee share schemes Outlays linked to establishing and running an employees’ share scheme can qualify for corporation tax ( CT) relief, either by virtue of targeted statutory rules or under the general provisions for corporate spending. Whether a deduction is available depends on the type of employee share arrangement the business operates. The position is determined by the nature of the scheme adopted by the company. For background on corporation tax, including rates and when they apply, see Practice Note: What is the basis of corporation tax? Specific legislative provisions Share incentive plans ( SIPs) A share incentive plan ( SIP) is a tax-favoured employee share scheme through which staff may obtain shares in their employer (or the employer’s parent) that are kept within a SIP trust for a set period. For more on SIPs, see...
Practice Note This Practice Note outlines the general SDLT treatment of partnerships, clarifying what qualifies as a partnership for SDLT and how such bodies sit within the wider SDLT framework. It also addresses transfers of interests in a partnership. It explains: which entities and arrangements are treated as partnerships for SDLT the SDLT treatment applicable to partnerships how SDLT operates where a partnership buys a chargeable interest in land from an unconnected party who must file returns and pay SDLT together with any associated liabilities Separate Practice Notes cover what the SDLT legislation terms: special transactions (that is, acquisitions from and disposals to connected persons or partners of a partnership), see Practice Notes: SDLT and partnerships—transfers to a partnership and SDLT and partnerships—transfers from a partnership anti-avoidance rules and reliefs, see Practice Note: SDLT and...
This Practice Note Sets out details of stamp duty land tax ( SDLT) anti-avoidance provisions and SDLT reliefs that apply specifically to partnership transactions. It explains: how anti-avoidance rules of general application may operate for partnerships which additional anti-avoidance rules are aimed at partnership dealings, and how general reliefs work for partnership transactions In broad terms, SDLT anti-avoidance rules and reliefs apply to partnerships as they would to the constituent partners. However, some general provisions are modified and there are extra rules targeted at partnerships, including: rules governing transfers of interests in property investment partnerships are, in essence, anti-avoidance measures where a chargeable interest moves from a corporate partnership to a partner, the usual treatment may instead require a claim to group relief to eliminate the SDLT charge, and a withdrawal of value by a partner can trigger an SDLT...
FORTHCOMING CHANGE relating to UK permanent establishments: Following a prior 2023 consultation, on 28 April 2025 the government opened a technical consultation on draft legislation overhauling the UK permanent establishment ( PE) regime to: (i) bring domestic profit attribution rules for PEs into line with the latest OECD materials and the interpretation of the ‘separate enterprise principle’, (ii) refresh the domestic meaning of a dependent agent PE in accordance with the 2017 OECD Model Tax Convention, (iii) revise the reach of the investment manager exemption, (iv) harmonise the domestic treatment of gains linked to PEs with the 2017 OECD Model Tax Convention, and (v) make knock-on changes so PE concepts are applied consistently across UK tax law. Draft legislation was published for technical comment as part of this exercise. The draft rules do not change the content or...
This Practice Note: explains: the role of the tax credit clause commonly included in a loan agreement; and that the typical wording of this clause is lender‑friendly, which in turn restricts the borrower’s ability to benefit; and provides drafting ideas to help a borrower secure the benefit of any tax refund or rebate available from a treaty lender. In the context of syndicated loans to corporate borrowers, it is usual to adopt one of the Loan Market Association ( LMA) model loan facility agreements, each of which: contains a standard tax credit clause; is drafted in a manner that is favourable to lenders; and assumes the relevant tax is UK withholding tax—so it is essential to identify which...
Stop Press: Section 49 and Schedule 7 of the Finance Act 2026 revise the UK’s domestic rules concerning UK permanent establishments of non‑ UK companies, taking effect for accounting periods (for corporation tax purposes) or tax years (for income tax purposes) beginning on or after 1 January 2026. The changes update the definition of a UK permanent establishment and the provisions dealing with the attribution of profits to a UK permanent establishment, in each case aiming to bring the position more closely into line with the OECD Model Tax Convention. They also modify how the investment manager exemption operates. For further information, see News Analysis: Budget 2025— Tax analysis — International. This Practice Note explores the concept of a permanent establishment ( PE) for tax, under UK domestic law and within double tax treaties ( DTTs). A company that is not...
Where a company disposes of an intangible fixed asset ( IFA) that falls within the corporate intangible assets regime in Part 8 of the Corporation Tax Act 2009 ( CTA 2009), any gain or loss arising is recognised for corporation tax as, as appropriate, a credit or a debit. Amounts brought in under CTA 2009, Pt 8 are dealt with as income items, both for charge and relief. Consequently, the usual income/capital divide under general tax law is disapplied. Instead, a credit or debit on the realisation of an IFA is treated either (i) as a receipt or expense of a trade or of a property business, or (ii) where the IFA is not held for the purposes of a trade or property business, as a non-trading credit or a non-trading debit. For further detail on the taxation of IFAs, refer to...
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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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