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Introduction to statutory interpretation The aim of statutory interpretation is to determine the legal meaning of a statute, that is, the sense that expresses the legislator’s intention. The clearest guide to that intention is the statutory wording itself, read in its context and with its overall purpose in mind, and its broader legislative setting. Courts should seek to fulfil the purpose of legislation by construing its language, so far as they can, in the manner that most effectively serves that purpose. Put differently, the courts’ default method is purposive, and every enactment is to be construed with that end in view. There is a starting presumption that the grammatical and ordinary sense of an enactment reflects the meaning intended by the legislator. Where an enactment reasonably bears only a single meaning, and no other interpretative tools or
This Practice Note addresses identifying a fiduciary, fiduciary duties and obligations, the no conflict rule, the no profit rule, a fiduciary's duty of confidence, and the remedies available for breach of fiduciary duty. Who is a fiduciary? There is no definitive catalogue of relationships that give rise to fiduciary obligations at common law in every situation universally. Certain relationships are inherently fiduciary, eg trustee and beneficiary, solicitor and client, principal and agent, business partner and co-partners, together with mortgagor and mortgagee. The obligations of some fiduciaries have been set out in statute; for instance, trustees owe a statutory duty of skill and care under section 1 of the Trustee Act 2000 (TrA 2000), and directors' relationships with their companies are addressed in the Companies Act 2006 too. For guidance on directors' fiduciary duties, see Practice Note: of directors for further detailed
Definition of ADR Alternative dispute resolution (ADR) is defined in the CPR Glossary as a collective label for methods of settling disputes other than through the usual trial process. Some courts adopt the term ‘negotiated dispute resolution’ (NDR) to describe resolution by alternative means; for ease, this Practice Note uses ADR. For guidance on how ADR is addressed in the various court guides, see Practice Note: ADR and NDR in the court guides. In essence, ADR is a means of resolving a dispute outside the court system. It typically involves a neutral third party who either helps the parties reach a negotiated outcome, or issues a determination of the dispute that is legally binding. A binding result can follow where the agreement to refer the dispute to ADR so provides. There are multiple forms of ADR processes. For an outline of the different types and their
In brief The British constitution is uncodified, meaning it does not spring from a single constitutional document or code. It draws on a wide range of written and unwritten sources. Alongside the principal written sources of law in England and Wales—legislation (which has also introduced international and human rights principles into our constitution) and the common law—the constitution also rests on two further unwritten bases within this system: the prerogative, and non-legal constitutional conventions. In addition, on one view the basic or prevailing principle of our constitution, Parliamentary sovereignty, is ultimately grounded in political fact rather than in law. Legislation Legislation is the foremost source of constitutional law. Acts of Parliament may set out detailed constitutional rules, or even pass authority to create them to ministers or to others. Under the doctrine of Parliamentary sovereignty, legislation is traditionally regarded as taking precedence over any other form or kind of
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Sukuk (singular form: ‘sakk’) Sukuk are Shari’a-compliant financing instruments, commonly described as Islamic certificates or bonds. For further detail, see Practice Notes: The structure and elements of a Sukuk transaction and Sukuk—investment bond arrangements and their UK direct tax treatment— What are sukuk? Where the statutory requirements are satisfied, sukuk can access the UK tax regime that applies to alternative finance investment bond ( AFIB) arrangements. For guidance on those provisions, see Practice Note: Sukuk—investment bond arrangements and their UK direct tax treatment. A distinct variant is sukuk al ijara. In such structures, the bond-issuer (the legislative term for the sukuk issuer) typically holds land on trust for the certificate holders (the sukuk investors). The issuer secures a land interest through a sale and leaseback—the ijara element. For more detail, see Practice Notes: The structure and elements of a Sukuk...
FORTHCOMING CHANGE relating to call for evidence on tax support for entrepreneurs: At the 2025 Budget, the government issued a call for evidence—closing on 28 February 2026—examining how current tax incentive regimes operate and considering avenues to extend backing for entrepreneurs. The exercise aims to assess how well the existing EIS and VCT arrangements perform, to consider novel mechanisms to assist scaling businesses that have hit the VCT and EIS thresholds, and to collect insight on how tax measures could motivate a broader range of investors. This Practice Note reviews the principal UK tax reliefs that may be available to individuals running a company seeking growth finance, namely seed, venture or development funding. Founders, proprietors, directors and senior management of a business pursuing growth finance will commonly hold equity in the company. Those shares may be owned before any growth capital is...
This Practice Note outlines the principal UK tax reliefs potentially available to individuals who supply seed or venture finance to unconnected start-up and early-stage companies. These backers typically inject capital across successive funding rounds and often insist that key people active in the business also join those rounds by subscribing for shares in the company. For analysis of the tax consequences linked to shares taken up in this manner, see Practice Notes: Tax and growth capital—management shareholdings and Tax and growth capital—tax reliefs available to managers. Seed and venture capital Unquoted businesses generally need investment at each phase of their growth, from formation through to the point the enterprise is well established and profitable. Companies frequently seek backing from the private equity and venture capital sector, where external investors provide finance in exchange for an equity interest in potentially high growth companies. Large private equity funds often...
FORTHCOMING CHANGE relating to income tax rates applicable to dividends : As set out at Budget 2025, Finance Bill 2026 introduces provisions that will raise the income tax rates applying to dividend income from 6 April 2026. The dividend ordinary rate (covering dividend income that would otherwise be taxed at the basic rate) and the dividend upper rate (covering dividend income that would otherwise be taxed at the higher rate) will each increase by two percentage points, to 10.75% and 35.75%, respectively. The dividend additional rate (relating to dividend income that would otherwise be charged at the additional rate) will remain the same at 39.35%......
This Practice Note This Practice Note explains what is typically included in a UK tax opinion prepared by tax lawyers for UK tax resident securitisation companies participating in a whole business securitisation (also described as an operating asset securitisation). A specific corporation tax regime applies to companies that: qualify as securitisation companies; and meet two additional conditions: the unallowable purposes test; and the payments condition That regime is contained in the Taxation of Securitisation Companies Regulations 2006, SI 2006/3296 ( Securitisation Regs), and is often called the permanent securitisation regime. It is described in Practice Note: Asset-backed securitisations—the UK tax treatment by reference to an asset-backed securitisation structure, and can also apply to a whole business...
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....
This Practice Note reviews the UK tax considerations around the operation and termination of a joint venture conducted through a limited liability company ( JVCo), which is a distinct legal person from the joint venture parties involved. For further details on the tax treatment of putting a JVCo in place, see Practice Note: Tax implications of establishing a joint venture company. For the purposes of this Practice Note, it is assumed that the joint venture parties are UK tax resident corporate entities and that the JVCo itself is also UK tax resident; for joint ventures with a non- UK element, see Practice Note: Tax implications of international joint ventures. Operation of the JVCo Extraction and taxation of the JVCo’s profits Because the JVCo is an independent legal person, profits generated by the business belong to the company itself and not the parties, unlike a...
This Practice Note explores illustrative tax situations that may occur when a UK management team takes up shares in Newco 1 during a private equity-backed management buyout ( MBO). It should be read alongside Practice Note: Tax and management buyouts—management shareholdings. For an explanation of what MBOs are, and their usual structuring and funding, see Practice Note: Tax and management buyouts—what is a management buyout? The examples below use very simplified calculations, intended only to highlight how outcomes can differ across possible scenarios. Accordingly, they serve purely as an aid to understanding how the different tax charges on management shares can interact, and the significance of available mitigation routes. Note that they address UK tax only. They ignore any potential tax deductions (for example, disposal costs) and assume no anti-avoidance rules apply. The examples consider: the income tax charge on general...
Earn-outs An earn-out is a distinct method of structuring the consideration on a share acquisition, under which part of the purchase price is set by reference to the target’s performance during a defined period after completion of the acquisition. In deals that include an earn-out, the amount paid by the buyer for the shares will usually comprise: an agreed, initial sum of consideration payable on completion of the sale; and a contingent, unascertainable earn-out amount payable over, or at the end of, the agreed earn-out period The initial consideration and the earn-out consideration can be satisfied wholly in cash, in shares or loan notes issued by the buyer (or a connected company), or in any combination thereof. The earn-out component is often calculated by reference to the target company’s profits over a specified span, for example the next two or three accounting periods following completion of the...
Anyone planning to depart the UK should weigh both fiscal and wider practical consequences of the move. Laws and customs in the destination may vary, sometimes sharply, from those in the UK. Securing high-quality information and advice before deciding is essential. healthcare retirement considerations property ownership Prospective emigrants must also think through the fallout if complications disrupt their plan to secure non-resident status, potentially requiring a return to UK residence later. This Practice Note focuses on the key considerations when aiming to become non- UK resident for tax purposes. Leaving the UK—statutory residence test At the heart of the income tax, CGT and IHT position for leavers is the concept of residence. Up to 6 April 2025, domicile also played a significant role in assessing IHT exposure and access to the remittance basis. From 6 April 2025, domicile no longer has...
This Practice Note examines the UK tax considerations when setting up a joint venture run through a partnership. For the purposes of this Practice Note, it is assumed that: the joint venture participants are UK tax resident corporate bodies the joint venture partnership vehicle is likewise UK tax resident; and the venture’s activities are conducted in the UK For information on: operating and winding up a joint venture partnership, see Practice Note: Tax implications of operating and terminating a joint venture partnership; and joint ventures with a non- UK dimension, see Practice Note: Tax implications of international joint ventures This Practice Note does not address certain investment partnerships that are unit trust schemes which may not be treated as transparent for tax purposes. What types of partnership may be used for a joint venture? A joint venture may employ one of the...
FORTHCOMING CHANGE relating to UK transfer pricing legislation: The Finance Bill 2026 (as introduced) outlines wide-ranging revisions to the UK’s transfer pricing rules. Once enacted, for accounting periods starting on or after 1 January 2026, the measures will, amongst other things, abolish UK-to- UK transfer pricing (with exclusions intended to prevent tax arbitrage), modify the participation condition, confirm that the OECD Model Tax Convention and the OECD Transfer Pricing Guidelines operate as interpretative aids when applying the legislation, and introduce a series of updates to the financial transactions provisions to better align the UK framework with the OECD Transfer Pricing Guidelines. In parallel, the government announced at Budget 2025 that it will proceed with an obligation for in-scope multinationals to file and report annual information on cross-border related party transactions for accounting periods beginning on or after 1 January 2027—the technical...
Taxpayers who settle tax after the deadline are liable to interest, charged at a rate laid down in law. The Finance Act 2009 ( FA 2009) established a unified framework for interest on late-paid tax intended to apply across all taxes, excluding excise duties; corporation tax and petroleum revenue tax were at first outside the framework, but are now slated for inclusion from a date yet to be confirmed. This Practice Note outlines both the unified rules and also covers how interest may arise where late payment falls outside that framework. Harmonised late paid interest regime The FA 2009 framework is being phased in progressively across the different taxes......
A range of tax reliefs exists for individuals who back unlisted shares and securities, including those admitted to trading on AIM. AIM, a market run by the London Stock Exchange ( LSE), is designed for small and medium-sized growth businesses. Although people often say securities are ‘listed on AIM’, they are not listed; they are simply admitted to trading on AIM. Where a company’s shares or securities are admitted to AIM and it has no other securities listed on a recognised stock exchange, the company is regarded as unquoted. This Practice Note includes a table setting out the principal tax breaks for individuals investing in unlisted, higher-risk companies, and a second table describing the reliefs for individuals who invest indirectly in such companies through a venture capital trust. For information on the reliefs available to companies, see Practice Note: Tax...
Several tax incentives exist for companies that put capital into unlisted shares and securities, including those admitted to trading on AIM. AIM, one of the London Stock Exchange ( LSE)’s markets, caters for small and medium-sized growth companies. While holdings traded on AIM are often described as ‘listed on AIM’, they are not listed; they are admitted to trading. Where a company’s shares or securities are admitted to AIM and it has no other securities listed on a recognised stock exchange, those securities are unlisted and the company is treated as unquoted. This Practice Note includes a table setting out the principal tax incentives available to companies investing in higher-risk unlisted companies. For details of reliefs available to individuals, and the policy rationale for them, see Practice Note: Tax incentives for individuals investing in AIM companies. In this Practice Note: AIM means the AIM market of the...
This Practice Note This Practice Note examines the principal tax considerations that arise when setting up, managing and winding up an international joint venture, in addition to those encountered with a domestic UK joint venture... For guidance on the UK tax aspects of domestic joint ventures, refer to the following Practice Notes: Tax implications of contractual joint ventures Tax implications of establishing a joint venture partnership Tax implications of operating and terminating a joint venture partnership Tax implications of establishing a joint venture company Tax implications of operating and terminating a joint venture company For this Practice Note, an international joint venture is treated as an arrangement where either the joint venture vehicle (if there is one) or at least one joint venture party is not UK tax resident. It is assumed throughout that the joint venture...
This Practice Note will consider the following: direct tax issues for UK resident corporate bondholders direct tax issues for UK resident individual bondholders the UK stamp tax and VAT consequences of being a bondholder (whether individual or corporate) Bondholders may likewise wish to note the possible implications for them of the Foreign Account Tax Compliance Act ( FATCA) and the EU Financial Transactions Tax ( FTT). These are addressed in Practice Note: Tax issues for bond issuers— FATCA and FTT. Direct tax issues for corporate bondholders For UK resident companies acquiring a bond, the principal tax questions to assess are: the loan relationship rules—the bond will almost always be a loan relationship and be taxed on that basis chargeable gains—the bond will almost always be a qualifying corporate bond and exempt from corporation tax on chargeable gains withholding tax—the bondholder will look to rely on an exemption from...
Practice Note: Forms of business vehicle—tax summary When one or more individuals decide to set up a business, they must choose the vehicle through which the business will be run. In addition to the commercial and legal reasons informing that decision (see Practice Note: Forms of business vehicle), the tax treatment applicable to each distinct vehicle will often be the determining factor in deciding whether it is suitable for carrying on a particular business. A summary of the tax consequences of operating as: a sole trader a general partnership a limited partnership a limited liability partnership a company is addressed in Practice Note: Forms of business vehicle—tax summary and the Choice of business vehicle—tax comparison table. This Practice Note brings together some of the principal tax considerations that shape the decision of a person, or a group of people, when weighing the choice of business vehicle,...
FORTHCOMING CHANGE relating to the tax treatment of carried interest: After a call for evidence on the taxation of carried interest ran through summer 2024, the Autumn Budget 2024 confirmed the government's intention to launch a revamped regime for carried interest from 6 April 2026, positioned within the income tax system and accompanied by bespoke rules recognising the distinctive features of this remuneration. A consultation then explored possible new qualifying criteria for entry to the regime, with the government issuing its response in June 2025. On 21 July 2025, draft legislation establishing the new carried interest rules was released for inclusion in Finance Bill 2026. The measures will apply to carried interest arising on or after 6 April 2026. These announcements were reiterated at the 26 November 2025 Budget, which also noted that certain amendments had been made to the draft to reflect...
Follow the link below to download the training presentation. Abolition of non-dom regime and introduction of residence-based IHT regime Finance Act 2025 ( FA 2025) enacted significant measures abolishing the remittance basis of taxation and introducing a new residence-based system, effective from 6 April 2025. It also substituted domicile as the principal legal determinant of inheritance tax ( IHT) exposure. Further wide-ranging reforms encompassed revisions to the legal criteria for excluded property status, the removal of protected settlements status for offshore trusts, and further reforms 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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