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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:
Most recent Practice notes
Stop Press : From accounting periods starting on or after 1 January 2026, the Diverted Profits Tax is superseded by the unassessed transfer pricing profits rules. This Practice Note, alongside Transactions in UK land—tax rules, examines the anti-avoidance provisions aimed at countering attempts to sidestep tax on income, profits or gains connected with arrangements concerning, or trades of dealing in, land. The main anti-avoidance measure seeks to treat gains of a capital character realised on the disposal of land as income, bringing them within income tax or corporation tax. Further detail appears in Practice Note: Transactions in UK land—tax rules. From 5 July 2016 these rules superseded and expanded the former transactions in land rules (for information on prior rules, see Practice Note: Real estate—anti-avoidance: disposals of land and taxing capital gains as income (pre 5 July 2016) [...
Stop Press: Section 49 of, and Schedule 7 to, the Finance Act 2026 amends the UK’s domestic legislation in relation to UK permanent establishments of non- UK companies, with effect for accounting periods (in the case of corporation tax) or tax years (in the case of income tax) beginning on or after 1 January 2026 These measures update the meaning of a UK permanent establishment and the framework for allocating profits to a UK permanent establishment, in each case to achieve closer alignment with the OECD Model Tax Convention. They also refine how the investment manager exemption applies in practice and operates. For more information and analysis, see News Analysis: Budget 2025— Tax analysis — International. This Practice Note explores what constitutes a UK permanent establishment ( PE) in the specific context of UK real estate......
FORTHCOMING CHANGE relating to the tax treatment of carried interest: After a summer 2024 call for evidence on how carried interest is taxed, the Autumn Budget 2024 confirmed a revamped carried interest regime from 6 April 2026, to sit within the income tax framework, with bespoke provisions reflecting the distinctive nature of the reward. A consultation on prospective qualifying criteria for entry to the regime then took place, with the government publishing its response in June 2025. Draft clauses for the regime were released on 21 July 2025 for inclusion in Finance Bill 2026. The rules will apply to carried interest arising on or after 6 April 2026. In the interim, the capital gains tax rate on carried interest increased to 32% with effect from 6 April 2025. For further detail on this carried interest tax reform, including commentary from legal...
The enterprise investment scheme ( EIS) It is primarily intended to boost investment in smaller, higher‑risk trading companies by granting a range of tax reliefs to individual investors who acquire newly issued shares in such companies. The EIS rules are prescriptive and contain numerous conditions that must be satisfied, including those relating to: the individual investors the issued shares the issuing company This Practice Note centres on the conditions that apply to the individual investor. Those conditions are outlined in the context of the income tax relief afforded by Part 5 of the Income Tax Act 2007 ( ITA 2007). References to the equivalent capital gains tax ( CGT) provisions are included where appropriate. For information on the remaining conditions, see the following Practice Notes: EIS—conditions for relief: issued shares, the funds raised and the arrangements in...
STOP PRESS: Abolition of non-dom regime and introduction of residence-based IHT regime Finance Act 2025 ( FA 2025), which received Royal Assent on 20 March 2025, brings in legislation to scrap the remittance basis of taxation and introduce a residence-based system from 6 April 2025. FA 2025 also removes domicile as the principal criterion for establishing inheritance tax liability. Further measures include: Revisions to the rules that determine excluded property status The removal of protected settlements status for offshore trusts Changes to overseas workday relief For more on these developments, see: Practice Notes: The abolition of the remittance basis of taxation from 2025–26 and A new residence-based regime for IHT from 2025–26. The loan relationships rules in Part 5 of the Corporation Tax Act 2009 ( CTA 2009) include anti-avoidance provisions concerning the late payment of interest. Where these provisions (the late-paid interest rules) are engaged, they can postpone the point at...
A non-small company will generally be liable to corporation tax on a distribution it receives unless, subject to certain other requirements, the distribution falls within an exempt category. There are five exempt categories of distribution: distributions on non-redeemable ordinary shares, explained further in this Practice Note distributions from controlled companies distributions in respect of portfolio holdings distributions arising from transactions not designed to reduce tax dividends on shares accounted for as liabilities For more on the tax charge on distributions, see Practice Note: How are non-small companies taxed on distributions received. For the exemptions for small companies, see Practice Note: How are small companies taxed on distributions received? For what counts as a small company, see Practice Note: What is a small company for the purposes of the distribution exemption? The exemption A distribution is an exempt class if it is paid in respect of a share that is: an ordinary share, and not...
Why are special rules required to deal with historic losses? As set out in Practice Note: UK taxation of foreign profits in a UK resident company, a company may utilise losses arising in trades carried on through its permanent establishments ( PEs) to lessen UK tax on profits in certain circumstances. However, where a UK company: incurs losses in another jurisdiction, and secures relief in that jurisdiction for those losses (for example, relief in a later year, comparable to the UK carry forward of losses) in the year the relief is taken, the UK credit for foreign tax would be reduced (and so the amount of UK corporation tax would increase) because the credit is computed only by reference to the profits on which foreign tax is actually suffered (see Practice Note: Effect and limits of credit relief). In this way, under the default...
GOVERNMENT CONSULTATION : The government is consulting on proposals to require close companies to give HMRC more granular information about transactions with participators (usually shareholders). In scope are: Cash withdrawals Loans Debts Dividends Other distributions Asset transfers Items already reported via RTI, such as salary, would be excluded. Reported data would set out the recipient, amount, date, and identifying details, potentially including NI numbers. Views are sought on the scope, timing and delivery method (for example via CT600A, the company tax return, or a digital service), whether repayments, releases and write‑offs of loans should be included, and whether existing penalties are adequate or bespoke penalties are needed. The consultation closes on 10 June 2026. Introduction and summary of main rules Without specific rules, a company controlled by a small number of persons could structure its affairs to enable those persons to...
FORTHCOMING CHANGE relating to the UK funds regime : The outcome of the government’s review of the UK funds regime (see News Analyses: Review of the UK funds regime—an analysis, and HM Treasury’s review of the UK funds regime—a call for input) contains proposals to keep the tax treatment of the new long-term asset fund structure ( LTAF) under ongoing review. This Practice Note considers the genuine diversity of ownership ( GDO) requirement, which: certain authorised investment funds must meet to obtain favourable tax treatment under the tax regime applicable to authorised investment funds; and all authorised investment funds must meet to benefit from the certainty provided by the ‘investment transactions list’ (sometimes called the ‘white list’); and relevant authorised investment funds must meet to enter the property AIF ( PAIF) or tax elected fund ( TEF) tax...
Practice Note: Termination payments taxed as earnings The starting point for any termination payment or benefit is to determine whether, on basic principles, it is chargeable as earnings or an emolument of an office or employment under section 62 of the Income Tax ( Earnings and Pensions) Act 2003 ( ITEPA 2003). That issue must be decided before looking at any other charging provisions. For the principles to apply when deciding if a payment linked to the termination of an office or employment is taxable as earnings (or emoluments) under ITEPA 2003, s 62, see Practice Note: Termination payments taxed as earnings. This Practice Note concentrates on the specific deeming rules in ITEPA 2003, Part 6, Chapter 3, which subject to income tax payments and benefits on the termination of, or a change in the duties or functions of, an office or...
FORTHCOMING CHANGE relating to the modernisation of stamp taxes on shares framework: In 2027, stamp duty and SDRT will be replaced by a single, self-assessed tax on securities—the securities transfer charge ( STC)—to be paid and filed through a new online portal. The STC’s core features will broadly reflect the proposals consulted on in 2023. Finance Bill 2026 ( FB 2026) introduces a power, effective from Royal Assent, to make secondary legislation enabling taxpayers to test the digital service by self-assessing their stamp taxes on securities liabilities and reporting transactions electronically. For further detail on the modernisation of stamp taxes on securities, see News Analyses: Budget 2025— Tax analysis— Stamp and transfer taxes, Tax update spring 2025— Stamp taxes on shares modernisation, Tax update spring 2025— Tax analysis— Stamp and transfer taxes, TAMD 2023— Stamp taxes on shares...
Ramsay principle—further developments Lexis+® UK Tax thanks Nigel Doran of Macfarlanes LLP for comments on an earlier draft of this Practice Note; nevertheless, the opinions expressed are those of Lexis+® UK Tax. The Note has since been reviewed and updated by Aparna Nathan, KC, Devereux Chambers. It examines themes arising from cases where the courts have deployed the Ramsay principle to adopt a realistic assessment of the facts. For an introductory overview of the Ramsay principle, see Practice Note: Ramsay as a guide to statutory construction. The way in which the courts have approached Ramsay where transactions comprise a sequence of steps intended to operate together to secure a particular tax outcome is addressed in Practice Note: Ramsay and composite transactions. This Practice Note considers further developments that have emerged as the courts have explored how that approach should be applied across varying...
This Practice Note sets out the criminal offences concerning offshore tax evasion found in section 106 of the Taxes Management Act 1970 ( TMA 1970). Offences under the TMA 1970 Under the TMA 1970, the offences include: failing to notify that one is chargeable to tax failing to submit a return delivering an inaccurate return Who may be guilty of the offences? Any individual who has not fully or correctly revealed that they are chargeable to income tax ( IT), capital gains tax ( CGT), or both, in relation to offshore matters. The government has indicated that ordinary principles of criminal secondary liability also apply, so the offence extends to an agent who knowingly files returns that omit tax due. See Practice Note: Joint enterprise and secondary liability. Elements of the offences which the prosecution has to prove The components of the offences are...
This Practice Note has been prepared and authored by Anne Redston, Barrister. It represents solely her personal view; she is not authorised to speak for the Tribunals Service or the judiciary. Most judicial review ( JR) claims about tax must be taken to the Administrative Chamber of the High Court’s Chancery Division. Some may instead be made straight to the Upper Tribunal ( Tax and Chancery Chamber). JR tax claims pursued in the High Court are considered in the Practice Note entitled Judicial review in tax cases at the High Court. This Practice Note discusses: JR claims that can, in appropriate cases, be commenced directly in the Upper Tribunal ( UT) JR claims that must be moved from the High Court to the UT, and those that may, where appropriate, be moved to the UT the applicable procedure for JR applications brought in the UT The degree to which the...
Cross-border private M& A transactions This Practice Note sets out an overview of the issues an English-qualified lawyer may encounter when advising a seller or a buyer on a cross-border private M& A deal. The emphasis is on practical considerations a lawyer should keep in mind to ensure the transaction is run in the most efficient and effective manner possible. Key stages in cross-border M& A transactions The principal phases in a cross-border private company M& A transaction are: Preliminaries (pre-signing) stage Here, non-disclosure agreements ( NDAs, also called confidentiality agreements) and exclusivity arrangements are settled, due diligence is undertaken, and the share purchase agreement ( SPA) with related deal documentation is negotiated. In an auction sale, bids are solicited and a short list of bidders is compiled. The cross-border aspect requires smooth...
Under the loan relationships regime, a key tenet is that a company must recognise profits and losses on its loan relationships for corporation tax in accordance with the accounting treatment applied to those relationships, provided that treatment complies with GAAP. For further detail on the overarching rules for calculating and bringing into account profits and losses on loan relationships for corporation tax, see Practice Note: Loan relationships—the tax main rules. There are, however, circumstances in which the loan relationships code requires the tax position to diverge from the profit or loss shown in the accounts. This can arise where a financial instrument within the loan relationships rules: becomes impaired, or is released (wholly or partly) In these events, the statutory position can differ from the accounting outcome shown in the profit and...
The general rule As a broad principle, a company brings into account for corporation tax the profits and losses that arise on its derivative contracts by reference to the amounts of profit or loss shown in respect of those derivatives in the company’s relevant accounts, which are prepared in accordance with generally accepted accounting practice ( GAAP). Put another way, GAAP-compliant accounts provide the mechanism by which the presence, quantification and timing of taxable amounts linked to a company’s derivative contracts are determined for corporation tax purposes. This approach is commonly described as ‘tax following the accounts’. The legislative framework for taxing derivative contracts is set out in Part 7 of the Corporation Tax Act 2009 ( CTA 2009) ( CTA 2009, ss 570–710), and is considered further in Practice Note: Taxation of derivatives—the main rules. There are,...
This Practice Note considers when VAT zero-rating applies to developers who sell or let non-residential properties they have transformed for residential use—either as dwellings or for a relevant residential purpose. Why does zero-rating matter? If zero-rating is unavailable, the supply is generally exempt and the developer is unable to reclaim VAT (ie input tax) on costs, for example on the building’s conversion, professional fees and possibly on buying the property. For further guidance, see Practice Note: When can a person recover VAT? VAT cannot be reclaimed if it ought not to have been charged. Put simply, VAT charged in error is not reclaimable. Care is therefore required throughout projects. Where the project creates a dwelling, the conversion services are commonly taxed at 5%, or are zero-rated where a housing association commissions the work (see Practice Note: VAT treatment of building work). A 20% VAT claim may be...
This Practice Note explains the zero-rating of VAT for developers who sell or let dwellings they have built Why does zero-rating matter? Without zero-rating, the supply is typically exempt, meaning the developer is unable to reclaim VAT (ie input tax) on related expenditure, for example on professional fees and potentially on the site acquisition. For more details, see Practice Note: When can a person recover VAT? The building services provided during the construction of the dwelling will, in most cases, already have been zero-rated; see Practice Note: VAT treatment of building work. Where that is so, a developer who did not suffer VAT on buying the site may view zero-rating of sales and leases as advantageous, though not strictly necessary Why might zero-rating not apply? ......
For UK VAT to be chargeable, a transaction must satisfy five cumulative criteria. Specifically, it must: amount to a supply of goods or a supply of services constitute a taxable supply occur in the UK be made by a taxable person be carried out in the course or furtherance of any business operated by that person This Practice Note explains what each of those five requirements means. It does not, however, consider the importation of goods or those cases where a UK customer is obliged to account for UK VAT on services received from abroad—ie, the reverse charge; for those topics, see Practice Notes: VAT—the reverse charge on cross-border supplies and VAT—importing goods. This Practice Note also includes references to EU Directives and case law; for details on the continuing significance of EU Directives, and of judgments of the Court of...
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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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